Document:

exv10w8

 

EXHIBIT 10.8

SERVICE AGREEMENT

FOR TOLL SCHEDULE MN365

     This Service Agreement (“Service Agreement”) is made and entered into this 29th day of June,
2005, by and between Maritimes & Northeast Pipeline Limited Partnership (herein called “Pipeline”)
and Anadarko Canada LNG Marketing, Corp. (herein called “Customer”, whether one or more),

W I T N E S S E T H:

     WHEREAS, Customer has requested and Pipeline has agreed to transport quantities of gas that
are delivered by Customer or Customer’s agent to Pipeline pursuant to the terms of this Service
Agreement.

     NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements
herein contained, the parties do covenant and agree as follows:

ARTICLE I

SCOPE OF AGREEMENT

     Capitalized terms herein not otherwise defined shall have the meaning attributed thereto in
Pipeline’s Toll Schedule MN365, the GT&C of Pipeline’s Tariff on file with the National Energy
Board and that Precedent Agreement dated June 29, 2005 between Pipeline and Customer.

     Subject to the terms, conditions and limitations hereof, of Pipeline’s Toll Schedule MN365,
and of the GT&C, transportation service hereunder will be firm and Pipeline agrees to deliver for
Customer’s account quantities of natural gas up to the following quantity:

     Maximum Daily Transportation Quantity (MDTQ) = 857,444 GJ

     Notwithstanding the foregoing, commencing on the Initial Commencement Date, as that term
is defined in the Precedent Agreement, the MDTQ shall be a quantity equal to the Initial
MDTQ, as determined pursuant to the terms of Paragraph 5 of the Precedent Agreement. From and
after the Service Commencement Date, as that term is defined in the Precedent Agreement, this
paragraph shall be of no further force or effect and the MDTQ shall be as set forth in the
immediately preceding paragraph.

     Pipeline will receive for Customer’s account for transportation hereunder daily quantities of
gas up to Customer’s MDTQ, plus Fuel Retainage Quantity, at Point(s) of Receipt as specified in
Article IV herein. Pipeline will transport and deliver for Customer’s account such daily
quantities tendered up to such Customer’s MDTQ at Point(s) of Delivery as specified in Article IV
herein.

 

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     On any given Day, Pipeline shall not be obligated to, but may at its sole discretion, receive
at Point(s) of Receipt quantities of gas in excess of Pipeline’s Maximum Daily Receipt Obligation
(MDRO), plus Fuel Retainage Quantity, but shall not be obligated to receive in the aggregate at all
Points of Receipt on any Day a quantity of gas in excess of the applicable MDTQ, plus Fuel
Retainage Quantity. On any given Day, Pipeline shall not be obligated to, but may at its sole
discretion, deliver at Point(s) of Delivery quantities of gas in excess of Pipeline’s Maximum Daily
Delivery Obligation (MDDO), but shall not be obligated to deliver in the aggregate at all Points of
Delivery on any Day a quantity of gas in excess of the applicable MDTQ.

ARTICLE II

TERM OF AGREEMENT

     This Service Agreement shall become effective as of the date set forth hereinabove. Service
under this Service Agreement shall commence on the earlier of the Initial Commencement Date or the
Service Commencement Date, as such terms are defined in the Precedent Agreement, and shall become
effective as of the date set forth hereinabove and shall continue in effect for a term of twenty
(20) years from the Service Commencement Date (“Primary Term”) and shall remain in force from year
to year thereafter unless terminated by either party by written notice at least two years prior to
the end of the Primary Term or any successive term thereafter.

     Customer agrees that Pipeline may terminate this Service Agreement at any time subject to the
provisions of Articles 4 and 16 of the GT&C and such provisions are incorporated herein by
reference. If the Precedent Agreement terminates for a reason other than pursuant to Paragraph
10(G) thereof, then upon such termination, this Service Agreement shall promptly terminate and have
no further force or effect .

     Any portions of this Service Agreement necessary to correct or cash-out imbalances or to make
payment under this Service Agreement as required by the GT&C will survive the other parts of this
Service Agreement until such time as such balancing or payment has been accomplished. To the
extent that Customer desires to terminate this Service Agreement and Pipeline agrees to such
termination, Pipeline will collect as part of the exit fee all (or such lesser portion as Pipeline
agrees to) of the capacity Reservation Charges and surcharges otherwise recoverable by Pipeline
from Customer for the balance of the contractual term, absent such early termination.

ARTICLE III

TOLL SCHEDULE

     For the entire period when this Service Agreement is in effect, this Service Agreement will be
subject to all provisions of Toll Schedule MN365 and the GT&C of Pipeline’s Tariff on file with the
National Energy Board, all of which are by this reference made a part hereof.

     Customer agrees to and will pay Pipeline all Reservation, Usage and other charges and fees
provided for in Toll Schedule MN365, as effective from time to time, for service under this Service
Agreement, provided that from the earlier of (i) the Initial

 

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Commencement Date, or (ii) the Service Commencement Date and continuing for a period of
ninety (90) days the tolls paid by Customer will be applied only to quantities actually flowed
under this Service Agreement and not to the MDTQ under this Service Agreement; provided
further, that Customer shall have a minimum payment obligation during this ninety (90) day period
of twenty-five percent (25%) of the MDTQ multiplied by the MN365 Reservation Charge.

     Customer agrees that Pipeline shall have the unilateral right to file with the appropriate
regulatory authority and make changes effective in: (i) the tolls and charges applicable to service
pursuant to Pipeline’s Toll Schedule MN365 and under the Tariff; (ii) Pipeline’s Toll Schedule
MN365; and/or (iii) any provision of the GT&C under the Tariff. Customer shall have the right to
intervene and protest any such filing.

ARTICLE IV

POINT(S) OF RECEIPT AND DELIVERY

     The Point(s) of Receipt and Point(s) of Delivery at which Pipeline shall receive and deliver
gas, respectively, shall be specified in Exhibits A and B of this effective Service Agreement.

     Exhibits A and B are hereby incorporated as part of this Service Agreement for all intents and
purposes as if fully copied and set forth herein at length.

ARTICLE V

QUALITY

     All natural gas tendered to Pipeline for Customer’s account shall conform to the quality
specifications set forth in Article 12 of Pipeline’s GT&C. Customer agrees that if Customer
tenders gas for service hereunder and Pipeline accepts such gas which does not comply with
Pipeline’s quality specifications, Customer will pay all costs associated with processing of such
gas as necessary to comply with such quality specifications.

 

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ARTICLE VI

ADDRESSES

     Except as herein otherwise provided or as provided in the GT&C, any notice, request, demand,
statement, invoice or payment provided for in this Service Agreement, or any notice which any
party desires to give to the other, must be in writing and will be considered as duly delivered
when mailed by registered, certified, or regular mail to the post office address of the parties
hereto, as the case may be, as follows:

	 	 	 	 	 	 	 
	 

	 	(a)
	 	Pipeline:
	 	Maritimes & Northeast Pipeline Limited Partnership
	 

	 	 	 	 	 	Suite 1600, 1801 Hollis Street
	 

	 	 	 	 	 	Halifax, Nova Scotia
	 

	 	 	 	 	 	B3J 3N4
	 

	 	 	 	 	 	Attn: President
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Facsimile: (902) 423-7422
	 
	 	 	 	 	 	 
	 

	 	(b)
	 	Customer:
	 	Anadarko Canada LNG Marketing, Corp.
	 

	 	 	 	 	 	c/o Anadarko Petroleum Corporation
	 

	 	 	 	 	 	1201 Lake Robbins Drive
	 

	 	 	 	 	 	The Woodlands, Texas 77380
	 

	 	 	 	 	 	Attn: Manager, Commercial Development
	 

	 	 	 	 	 	Facsimile: (832) 636-8263
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Anadarko Canada LNG Marketing, Corp.
	 

	 	 	 	 	 	c/o Anadarko Petroleum Corporation
	 

	 	 	 	 	 	1201 Lake Robbins Drive
	 

	 	 	 	 	 	The Woodlands, Texas 77380
	 

	 	 	 	 	 	Attn: Gas Marketing Operations Manager
	 

	 	 	 	 	 	Facsimile: (832) 636-7215

or such other address as either party designates by formal written notice.

ARTICLE VII

ASSIGNMENTS

     Any Company which succeeds by purchase, merger, or consolidation to the properties,
substantially or in entirety, of Customer or of Pipeline will be entitled to the rights and will be
subject to the obligations of its predecessor in title under this Service Agreement. Either
Customer or Pipeline may assign or pledge this Service Agreement under the provisions of any
mortgage, deed of trust, indenture, bank credit agreement, assignment, receivable sale, or similar
instrument which it has executed or may execute hereafter. Except as set forth above, neither
Customer nor Pipeline shall assign this Service Agreement or any of its rights hereunder without
the prior written consent of the other party; provided, however, that neither Customer nor Pipeline
shall be released from its obligations hereunder without the consent of the other. In addition,
Customer may assign its rights to capacity pursuant to Article 9 of the GT&C.

 

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ARTICLE VIII

AGENCY ARRANGEMENT

     Customer shall have the right to designate an agent or person to provide nomination and
scheduling information, to receive invoices and make payments and to take actions necessary to
release capacity and handle imbalance resolutions for Customer on Customer’s behalf. The agent may
be the same as used for similar purposes with respect to transportation on Maritimes & Northeast
Pipeline, L.L.C. or other third party pipeline. Customer must provide Pipeline with ten (10)
Business Days’ advance written notice of its agent and the effective date after which Pipeline is
to act in accordance with the direction of the agent. Pipeline shall be entitled to rely on the
representations, actions, and other directions of the agent on behalf of Customer and will be fully
protected in relying upon such agent. Customer indemnifies and holds Pipeline harmless with
respect to actions taken by Pipeline in reliance on Customer’s agent.

ARTICLE IX

NONRECOURSE OBLIGATION OF

LIMITED PARTNERSHIP,

GENERAL PARTNER AND OPERATOR

     Customer acknowledges and agrees that: (a) Pipeline is a New Brunswick limited partnership;
(b) Customer shall have no recourse against any partner of Pipeline or against Maritimes &
Northeast Pipeline, L.L.C. or a member thereof with respect to Pipeline’s obligations under this
Service Agreement and that its sole recourse shall be against the assets and revenues of Pipeline,
irrespective of any failure to comply with applicable law or any provision of this Service
Agreement; (c) no claim shall be made against any partner of Pipeline or against Maritimes &
Northeast Pipeline, L.L.C. or a member thereof under or in connection with this Service Agreement;
(d) no claims shall be made against the Operator, its officers, employees, and agents, under or in
connection with this Service Agreement and the performance of its duties as Operator (provided that
this shall not bar claims resulting from the gross negligence, undue discrimination or willful
misconduct of the Operator) and Customer shall provide the Operator with a waiver of subrogation of
Customer’s insurance company for all such claims; and (e) this representation is made expressly for
the benefit of the partners in Pipeline, the General Partner, Operator, Maritimes & Northeast
Pipeline, L.L.C. and its members.

ARTICLE X

INTERPRETATION

     The parties hereto agree that the interpretation and performance of this Service Agreement
must be in accordance with the laws of the Province of New Brunswick without recourse to the law
governing conflict of laws.

     This Service Agreement and the obligations of the parties are subject to all present and
future valid laws with respect to the subject matter, Provincial and Federal,

 

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and to all valid present and future orders, rules, and regulations of duly constituted
authorities having jurisdiction.

ARTICLE XI

CANCELLATION OF PRIOR CONTRACT(S)

Not applicable.

     IN WITNESS WHEREOF, the parties hereto have caused this Service Agreement to be executed by
their respective duly authorized officers and attested by their respective Secretaries or Assistant
Secretaries, the day and year first above written.

	 	 	 	 	 	 	 
	 	 	 	 	MARITIMES & NORTHEAST PIPELINE LIMITED PARTNERSHIP

By its General Partner,

MARITIMES & NORTHEAST PIPELINE MANAGEMENT LTD.

	 
	 	 	 	 	 	 
	Witness:

	 	/s/ Randy Pelletier	 	By:	 	/s/ Douglas P. Bloom
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	Anadarko Canada LNG Marketing, Corp.
	 
	 	 	 	 	 	 
	Witness:

	 	/s/ Charlene Ripley
	 	By:
	 	     /s/ James R. Larson
	 

	 	 	 	 	 	 

 

EXHIBIT A

to

SERVICE AGREEMENT UNDER

TOLL SCHEDULE MN365

BETWEEN

MARITIMES & NORTHEAST PIPELINE LIMITED PARTNERSHIP

AND

ANADARKO CANADA LNG MARKETING, CORP.(“CUSTOMER”)

DATED June 29, 2005

FIRM RECEIPT POINTS

	 	 	 	 	 
	RECEIPT

POINT
	 	MDRO
	 	RECEIPT PRESSURE

LIMITATIONS
	 
	 	 
	 	 
	(plus applicable fuel

retainage quantities)	 	 	 	 

Bear Head in Richmond County,

Nova Scotia                                                   857,444 GJ/d

	*	 	This Exhibit A shall become effective on the Service Commencement Date. If the
Initial Commencement Date is earlier than the Service Commencement Date, then for the
period of time between the Initial Commencement Date and the Service Commencement Date,
the applicable MDRO shall equal the MDTQ which shall be determined in accordance with
Article I of this Agreement.

Signed for Identification

	 	 	 	 
	Pipeline:	/s/ Douglas P. Bloom	 	 
	Customer: 	/s/ James R. Larson	 
	Supersedes Exhibit A
Dated	 	 

 

EXHIBIT B

to

SERVICE AGREEMENT UNDER

TOLL SCHEDULE MN365

BETWEEN

MARITIMES & NORTHEAST PIPELINE LIMITED PARTNERSHIP

AND

ANADARKO CANADA LNG MARKETING, CORP. (“CUSTOMER”)

DATED June 29, 2005

FIRM DELIVERY POINTS

	 	 	 	 	 	 	 
	 

	 	DELIVERY
	 	 	 	DELIVERY PRESSURE
	 

	 	POINT
	 	MDDO
	 	LIMITATIONS
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	Halifax
	 	96,854GJ/d	 	 
	 
	 	 	 	 	 	 
	 

	 	Moncton
	 	22,789GJ/d	 	 
	 
	 	 	 	 	 	 
	 

	 	St. Stephen, New Brunswick
	 	737,801GJ/d	 	 

 

	*	 	This Exhibit B shall become effective on the Service Commencement Date. If the Initial
Commencement Date is earlier than the Service Commencement Date, then for the period of
time between the Initial Commencement Date and the Service Commencement Date, the
Primary Points of Delivery and applicable MDDOs shall be governed by a separate Exhibit
B to which Pipeline and Customer have mutually agreed.

	 	 	 	 
	Signed for Identification
Dated	 	 
	Pipeline:	/s/ Douglas P. Bloom	 	 
	Customer: 	/s/ James R. Larson	 
	Supersedes Exhibit B
Datedexv10w9

 

EXHIBIT 10.9

	 	 	 	 	 
	

	 	 	 	890 Winter Street
Suite 300
Waltham, MA 02451
(617) 254-4050
	 
	 

	 	 	 	Fax: (617) 254-1580
	 

	 	June 22, 2005	 	 

Anadarko Petroleum Corporation

Attn: Mr. Karl Kurz, Senior Vice President, Marketing

1201 Lake Robbins Dr.

The Woodlands, Texas 77380

     Re: Base Rate for Service Under the Service Agreement

Dear Mr. Kurz:

     This Base Rate Agreement (“Base Rate Agreement”) is made and entered into as of the 29th day of
June, 2005, by and between Maritimes & Northeast Pipeline, L.L.C. (“Pipeline”) and Anadarko LNG
Marketing, LLC (“Customer”). Pipeline and Customer are parties to that certain firm transportation
service agreement of even date herewith pursuant to Pipeline’s Rate Schedule MN365 designated as
Pipeline’s Contract No. 210099 (“Service Agreement”) and that certain Precedent Agreement of even
date herewith (“Precedent Agreement”). In accordance with the mutual covenants and agreements
contained herein, in the Service Agreement and the Precedent Agreement, Pipeline and Customer
desire to enter into this Base Rate Agreement to establish the “Base Rate” that the parties will
utilize in determining the Initial Rate Cap and the Rate Cap under the negotiated rate agreement
governing the rates during the Initial Rate Cap Period and the Rate Cap Period portion of the
primary term of the Service Agreement. The form of such negotiated rate agreement is attached
hereto as Schedule 2 (“Negotiated Rate Agreement”). Pipeline and Customer agree that this Base
Rate Agreement and the Negotiated Rate Agreement collectively shall mean the “Negotiated Rate
Agreement” as defined in the Precedent Agreement; provided that, upon termination of this Base Rate
Agreement, the term “Negotiated Rate Agreement” as defined in the Precedent Agreement shall mean
only the Negotiated Rate Agreement.

     Paragraphs 17, 18, 19, 20, 22, 23 and 24 of the Precedent Agreement are hereby incorporated by
reference and such provisions shall apply to this Base Rate Agreement in the same manner that they
apply to the Precedent Agreement.

     When used in this Agreement, and unless otherwise defined herein, capitalized terms shall have
the meanings set forth in the Service Agreement, in Pipeline’s FERC

 

 

Mr. Karl Kurz

Senior Vice President, Marketing

Anadarko Petroleum Corporation

Page 2

Gas Tariff (which includes the applicable rate schedules, General Terms and Conditions
(“GT&C”), and forms of service agreement), as amended from time to time (“Tariff”), the Negotiated
Rate Agreement, or the Precedent Agreement.

	1.	 	The “Initial Base Rate” shall be determined in accordance with this Paragraph 1. The Initial
Base Rate, which is currently estimated to be a reservation rate
equal to [   *   ] per Dth per
Day on a 100% load factor basis, as expressed in 2008 dollars, and is based on current cost
estimates for the Project facilities anticipated to be required to deliver the quantities as
set forth in Schedule 1 to this Base Rate Agreement, shall be calculated by Pipeline within
forty-five (45) days following the conclusion of the reverse open season, open season and
notice of expansion procedures, all of which will be conducted with respect to the Project and
all of which are more fully described in the Precedent Agreement. The Initial Base Rate shall
be a monthly Reservation Charge per Dth of MDTQ and shall be determined by utilizing
the same ratemaking methodology set forth in Schedule 3 to this Base Rate Agreement and shall
reflect (i) the Project facilities design following such reverse open season, open season and
notice of expansion procedures, (ii) Pipeline’s good faith estimate following the open season,
reverse open season and notice of expansion procedures of the costs associated with
construction of the Project facilities, and (iii) the actual Primary Point(s) of Delivery and
allocation of delivered volumes specified by Customer pursuant to Paragraph 4 of the Precedent
Agreement.

	2.	 	The “Base Rate” shall be determined in accordance with this Paragraph 2. The Base Rate shall
be a monthly Reservation Charge per Dth of MDTQ which shall be calculated by Pipeline prior to
filing the certificate application to be filed by Pipeline with FERC regarding the Project
facilities. The Base Rate shall be calculated as follows:

     Initial Base Rate x RB(2)/RB(1), where:

	 	•	 	“RB(1)” means the amount of Rate Base that underlies the Initial Base Rate,
as such amount is reflected in Schedule 3 to this Base Rate Agreement; and
	 
	 	•	 	“RB(2)” means RB(1) adjusted solely for any changes in the amount of RB(1)
attributable to the Project facilities as identified in Exhibit K to the
certificate application to be filed by Pipeline with FERC regarding the Project
facilities (Pipeline shall provide a draft Exhibit K to Customer prior to
calculating the Base Rate and the costs attributable to the Project facilities
in the Exhibit K to be filed by Pipeline shall not exceed the costs reflected
in the draft provided to Customer).

	*	 	This information has been omitted pursuant to a request for
confidential treatment. This information has been filed separately
with the Securities and Exchange Commission.

 

 

Mr. Karl Kurz

Senior Vice President, Marketing

Anadarko Petroleum Corporation

Page 3

	 	 	Pipeline and Customer shall utilize this Base Rate in determining the Initial Rate Cap and
the Rate Cap under the Negotiated Rate Agreement.
	 
	3.	 	Within five (5) business days after Pipeline calculates the Base Rate as contemplated under
Paragraph 2 of this Base Rate Agreement and delivers same to Customer, Pipeline and Customer
agree (i) to replace the term “Base Rate” in each place in which such term appears in brackets
in the form Negotiated Rate Agreement attached hereto as Schedule 2 with the actual Base Rate
so calculated; (ii) to replace the brackets in the definition of “Rate Base (1)” in the form
Negotiated Rate Agreement attached hereto as Schedule 2 with an amount equal to RB(2); and
(iii) to execute the Negotiated Rate Agreement reflecting the changes described in (i) and
(ii) above (but otherwise in the form attached hereto as Schedule 2).
	 
	4.	 	Promptly upon execution of the Negotiated Rate Agreement as contemplated under Paragraph 3 of
this Base Rate Agreement, this Base Rate Agreement shall terminate and have no further force
or effect; provided that, the parties acknowledge that the Base Rate calculated hereunder
shall be utilized after the termination of this Base Rate Agreement in determining the Initial
Rate Cap and the Rate Cap under the Negotiated Rate Agreement.

 

 

Mr. Karl Kurz

Senior Vice President, Marketing

Anadarko Petroleum Corporation

Page 4

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

	 	 	 
	 

	 	Sincerely,
	 
	 

	 	Maritimes & Northeast Pipeline, L.L.C.
	 

	 	by: M & N Management Company
	 

	 	its Managing Member
	 
	 	 
	 

	 	/s/ Douglas P. Bloom
	 

	 	Doug Bloom
	 
	 	 
	 

	 	President

ACCEPTED AND AGREED TO:

This 29th day of June, 2005

Anadarko LNG Marketing, LLC

	 	 	 	 	 
	By:

	 	/s/ James R. Larson	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Title:
	 	Senior Vice President, Finance

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