Document:

EXHIBIT 10.1
------------

                            CHANGE IN TERMS AGREEMENT

PRINCIPAL     LOAN DATE  MATURITY   LOAN NO  CALL/COLL ACCOUNT OFFICER INITIAL
$6,000,000.00 12-15-2004 01-31-2005 92018206                    636AW  /s/AW

References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.  Any item above
containing "***" has been omitted due to text length limitations.

Borrower: I/OMAGIC CORPORATION     Lender:  UNITED NATIONAL BANK
          4 MARCONI                         INTERNATIONAL DEPARTMENT
          IRVINE, CA 92618                  855 SOUTH ATLANTIC BLVD.,
                                            MONTEREY  PARK,  CA  91754
                                            (626)  281-5975
_______________

PRINCIPAL  AMOUNT:  $6,000,000.00                       INITIAL  RATE:  6.000%
DATE  OF  AGREEMENT:  DECEMBER  15,  2004

DESCRIPTION  OF  EXISTING INDEBTEDNESS. THIS CHANGE IN TERMS AGREEMENT REFERS TO
THE LOAN EVIDENCED BY THE PROMISSORY NOTE DATED AUGUST 15, 2003 IN FAVOR OF BANK
EXECUTED  BY I/OMAGIC CORPORATION IN THE AMOUNT OF $6,000,000.00 PAYABLE IN FULL
ON  SEPTEMBER 1, 2004 AND EXTENDED THE MATURITY OF THE NOTE TO DECEMBER 15, 2004
AS  EVIDENCED  BY  THE  CHANGE  IN  TERMS  AGREEMENT  DATED  DECEMBER  1,  2004.

DESCRIPTION  OF  COLLATERAL.

1)  1ST  POSITION  UCC FINANCING STATEMENT FILED ON JULY 30,2003 AT SECRETARY OF
STATE,  SACRAMENTO,  CA  AS  INSTRUMENT  #0321260018.
2)  1ST  POSITION  UCC  FINANCING  STATEMENT  FILED ON JULY 30, 2003 AT STATE OF
NEVADA  AS  INSTRUMENT  #2003020439-1.

DESCRIPTION  OF  CHANGE  IN TERMS. TO EXTEND THE MATURITY OF THE NOTE TO JANUARY
31,  2005.

CONTINUING VALIDITY. Except as expressly changed by this Agreement, the terms of
the  original  obligation  or obligations, including all agreements evidenced or
securing  the  obligation(s),  remain  unchanged  and  In full force and effect.
Consent  by  Lender  to  this  Agreement does not waive Lender's right to strict
performance  of  the  obligation(s)  as changed, nor obligate Lender to make any
future change in terms. Nothing In this Agreement will constitute a satisfaction
of  the obligation(s). It is the intention of Lender to retain as liable parties
all makers and endorser; of the original obligation(s), including accommodation
parties, unless a party is expressly released by Lender in writing. Any maker or
endorser, including accommodation makers, will not be released by virtue of this
Agreement.  If  any person who signed the original obligation does not sign this
Agreement  below, then all persons signing below acknowledge that this Agreement
Is  given  conditionally,  based  on  the  representation  to  Lender  that  the
non-signing  party  consents  to the changes and provisions of this Agreement or
otherwise  will  not  be  released  by  it.  This waiver applies not only to any
initial  extension,  modification  or  release,  but also to all such subsequent
actions.

BUSINESS  LOAN AGREEMENT (ASSET BASED). This Note is the Note referred to in the
Business  Loan  Agreement  (ASSET  BASED)  dated  August  15,  2003, between the
Borrower  and  Bank, as at any time amended (the "Business Loan Agreement (ASSET
BASED)"). Notwithstanding the paragraph entitled "DEFAULT" above and in addition
thereto,  upon  the occurrence of an event of default as defined In the Business
Loan  Agreement  (ASSET BASED), all sums of principal and interest the remaining
unpaid shall become due and payable, as provided in the Business Loan Agreement.

PRIOR TO SIGNING THIS AGREEMENT, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS
OF  THIS  AGREEMENT.  BORROWER  AGREES  TO  THE  TERMS  OF  THE  AGREEMENT.

BORROWER:

I/OMAGIC  CORPORATION

BY:  /s/  TONY  SHAHBAZ                         BY:  /s/  STEVE  GILLINGS
PRESIDENT  OF  I/OMAGIC  CORPORATION                 CHIEF  FINANCIAL OFFICER OF
                                                     I/OMAGIC  CORPORATION

LENDER:

UNITED  NATIONAL  BANK

X   /s/  ALLISON  WUExhibit 4.12

 

AGREEMENT REGARDING AMENDED AND RESTATED COMMON STOCK
PURCHASE WARRANT AND 5% CONVERTIBLE SUBORDINATED NOTE DUE 2008

 

This AGREEMENT REGARDING
AMENDED AND RESTATED COMMON STOCK PURCHASE WARRANT AND 5% CONVERTIBLE
SUBORDINATED NOTE DUE 2008 (the “Agreement”) is entered into as of the 14th day
of December, 2004 (the “Effective Date”), by and between Raining Data
Corporation, a Delaware corporation (the “Company”), and Astoria Capital
Partners, L.P. (“Holder”).

 

RECITALS

 

WHEREAS,
the Company issued Holder an Amended and Restated Common Stock Purchase
Warrant, which was originally issued on December 1, 2000 and was amended and
restated on April 1, 2003, exercisable for up to 1,136,555 shares of the
Company’s Common Stock (the “Warrant”).

 

WHEREAS,
on January 30, 2003, the Company issued Holder a 5% Convertible Subordinated
Note Due 2008 in the principal amount of $22,139,705 (the “Note”).

 

WHEREAS,
at various times the Company has issued to Holder PIK Notes (as defined in the
Note), as evidenced by letter agreements between the Company and Holder (the
“PIK Notes”), with respect to the interest payments that were due and payable
under the Note and were not paid in cash.

 

WHEREAS, per its terms, neither the Note
nor any PIK Note may be redeemed prior to January 30, 2005.

 

AGREEMENT

 

NOW,
THEREFORE, in consideration of the mutual promises and
covenants contained herein, it is hereby agreed by and between the parties
hereto as follows:

 

1.1  Consent Regarding Redemption.  Notwithstanding anything to the contrary in
the Note or the PIK Notes, each of Holder and the Company hereby consent to the
redemption in part of the Note and the PIK Notes prior to January 30, 2005 in
an amount equal to $2,670,904.25 (the “Redemption Amount”), which amount is
equal to the aggregate Exercise Price (as defined in the Warrant) of the
Warrant if such Warrant were exercised in full. 
On the date hereof, Holder shall exercise the Warrant in full pursuant
to Section 2 of the Warrant and shall pay the Exercise Price in cash rather
than through the net exercise provisions set forth in Section 3 of the
Warrant.  Immediately following receipt
of such payment, the Company shall pay Holder the Redemption Amount.  The Redemption Amount shall be applied as
follows:  first, to accrued and unpaid
interest on the Note and PIK Notes in an amount equal to $247,128.88; second,
to the principal amount of the PIK Notes in an amount equal to $1,914,165; and
third, to the principal amount of the Note in an amount equal to $509,610.37
(collectively, the “Cancelled Indebtedness”). 
Upon such payment of the Redemption Amount, the Cancelled Indebtedness
shall no longer be outstanding and shall be extinguished.

 

1.2  Severability.  Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.

 

1

 

1.3  Counterparts.  This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more than one
party, but all of which taken together will constitute one and the same Agreement.

 

1.4  Choice of Law. 
All questions concerning the construction, validity and interpretation
of this Agreement will be governed by the law of the State of California
without regard to its principles of conflicts of law.

 

1.5  Effect of Agreement.  Except
as set forth in this Agreement, the Warrant, Note and PIK Notes shall continue
in effect in accordance with their terms.

 

IN
WITNESS WHEREOF, the parties have executed this Agreement as
of the day and year first above written.

 

	
   

  	
  RAINING DATA CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Brian C. Bezdek

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  December 14, 2004

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ASTORIA CAPITAL PARTNERS, L.P.

  
	
   

  	
   

  
	
   

  	
  By:  Astoria
  Capital Management, Inc., its

  general partner

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Richard W. Koe

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  December 14, 2004

  	
   

  
						

 

2Exhibit 10.1

 

 

LUMP SUM
TURNKEY AGREEMENT

 

for the

 

ENGINEERING,
PROCUREMENT AND CONSTRUCTION

 

of the

 

SABINE
PASS LNG RECEIVING, STORAGE AND REGASIFICATION TERMINAL

 

by and
between

 

SABINE
PASS LNG, L.P.

 

as Owner

 

and

 

BECHTEL
CORPORATION

 

as
Contractor

 

Dated as
of the 18th Day of December, 2004

 

 

 

TABLE OF
CONTENTS

 

	
  RECITALS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  1

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  2

  	
  RELATIONSHIP
  OF OWNER, CONTRACTOR AND SUBCONTRACTORS

  	
   

  
	
   

  	
  2.1

  	
  Status of
  Contractor

  	
   

  
	
   

  	
  2.2

  	
  Key
  Personnel, Organization Chart and Contractor Representative

  	
   

  
	
   

  	
  2.3

  	
  Subcontractors
  and Sub-subcontractors

  	
   

  
	
   

  	
  2.4

  	
  Subcontracts
  and Sub-subcontracts

  	
   

  
	
   

  	
  2.5

  	
  Contractor
  Acknowledgements

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  3

  	
  CONTRACTOR’S
  RESPONSIBILITIES

  	
   

  
	
   

  	
  3.1

  	
  Scope of
  Work

  	
   

  
	
   

  	
  3.2

  	
  Specific
  Obligations

  	
   

  
	
   

  	
  3.3

  	
  Design and
  Engineering Work

  	
   

  
	
   

  	
  3.4

  	
  Spare Parts

  	
   

  
	
   

  	
  3.5

  	
  Training
  Program in General

  	
   

  
	
   

  	
  3.6

  	
  Environmental
  Regulations and Environmental Compliance

  	
   

  
	
   

  	
  3.7

  	
  Construction
  Equipment

  	
   

  
	
   

  	
  3.8

  	
  Employment
  of Personnel

  	
   

  
	
   

  	
  3.9

  	
  Clean-Up

  	
   

  
	
   

  	
  3.10

  	
  HSE Plan;
  Security

  	
   

  
	
   

  	
  3.11

  	
  Emergencies

  	
   

  
	
   

  	
  3.12

  	
  Contractor Permits

  	
   

  
	
   

  	
  3.13

  	
  Books, Records and Audits

  	
   

  
	
   

  	
  3.14

  	
  Tax Accounting

  	
   

  
	
   

  	
  3.15

  	
  Temporary Utilities, Roads, Facilities and Storage

  	
   

  
	
   

  	
  3.16

  	
  Subordination of Liens

  	
   

  
	
   

  	
  3.17

  	
  Hazardous Materials

  	
   

  
	
   

  	
  3.18

  	
  Quality Assurance

  	
   

  
	
   

  	
  3.19

  	
  Reports

  	
   

  
	
   

  	
  3.20

  	
  Payment

  	
   

  
	
   

  	
  3.21

  	
  Commercial Activities

  	
   

  
	
   

  	
  3.22

  	
  Title to Materials Found

  	
   

  
	
   

  	
  3.23

  	
  Survey Control Points and Layout

  	
   

  
	
   

  	
  3.24

  	
  Cooperation with Others

  	
   

  
	
   

  	
  3.25

  	
  Responsibility for Property

  	
   

  
	
   

  	
  3.26

  	
  Explosives

  	
   

  
	
   

  	
  3.27

  	
  Taxes

  	
   

  
	
   

  	
  3.28

  	
  Equipment Quality

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  OWNER’S RESPONSIBILITIES

  	
   

  
	
   

  	
  4.1

  	
  Payment and Financing

  	
   

  
	
   

  	
  4.2

  	
  Owner Permits

  	
   

  

 

 

	
   

  	
  4.3

  	
  Access to the Site and Off-Site Rights of Way and
  Easements

  	
   

  
	
   

  	
  4.4

  	
  Operation Personnel

  	
   

  
	
   

  	
  4.5

  	
  Sales and Use Tax Matters

  	
   

  
	
   

  	
  4.6

  	
  Legal Description and Survey

  	
   

  
	
   

  	
  4.7

  	
  Hazardous Materials

  	
   

  
	
   

  	
  4.8

  	
  Owner-Provided Items

  	
   

  
	
   

  	
  4.9

  	
  LNG Tanker Release

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  COMMENCEMENT OF WORK, PROJECT SCHEDULE, AND
  SCHEDULING OBLIGATIONS

  	
   

  
	
   

  	
  5.1

  	
  Commencement of Work

  	
   

  
	
   

  	
  5.2

  	
  Limited Notice to Proceed/Notice to Proceed

  	
   

  
	
   

  	
  5.3

  	
  Project Schedule

  	
   

  
	
   

  	
  5.4

  	
  CPM Schedule Submissions

  	
   

  
	
   

  	
  5.5

  	
  Recovery and Recovery Schedule

  	
   

  
	
   

  	
  5.6

  	
  Acceleration and Acceleration Schedule

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  CHANGES; FORCE MAJEURE; AND OWNER-CAUSED
  DELAY

  	
   

  
	
   

  	
  6.1

  	
  Change Orders Requested by Owner

  	
   

  
	
   

  	
  6.2

  	
  Change Orders Requested by Contractor

  	
   

  
	
   

  	
  6.3

  	
  Contract Price Adjustment; Contractor Documentation

  	
   

  
	
   

  	
  6.4

  	
  Change Orders Act as Accord and Satisfaction

  	
   

  
	
   

  	
  6.5

  	
  Timing Requirements for Notifications and Change
  Order Requests by Contractor

  	
   

  
	
   

  	
  6.6

  	
  Evidence of Funds

  	
   

  
	
   

  	
  6.7

  	
  Adjustment Only Through Change Order

  	
   

  
	
   

  	
  6.8

  	
  Force Majeure

  	
   

  
	
   

  	
  6.9

  	
  Extensions of Time and Adjustment of Compensation

  	
   

  
	
   

  	
  6.10

  	
  Delay

  	
   

  
	
   

  	
  6.11

  	
  Contractor Obligation to Mitigate Delay

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 7

  	
  CONTRACT PRICE AND PAYMENTS TO CONTRACTOR

  	
   

  
	
   

  	
  7.1

  	
  Contract Price

  	
   

  
	
   

  	
  7.2

  	
  Interim Payments

  	
   

  
	
   

  	
  7.3

  	
  Final Completion and Final Payment

  	
   

  
	
   

  	
  7.4

  	
  Payments Not Acceptance of Work

  	
   

  
	
   

  	
  7.5

  	
  Payments Withheld

  	
   

  
	
   

  	
  7.6

  	
  Interest on Late Payments and Improper Collection

  	
   

  
	
   

  	
  7.7

  	
  Offset

  	
   

  
	
   

  	
  7.8

  	
  Procedure for Withholding, Offset and Collection on
  the Letter of Credit

  	
   

  
	
   

  	
  7.9

  	
  Payment Error

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  TITLE AND RISK OF LOSS

  	
   

  
	
   

  	
  8.1

  	
  Title

  	
   

  
	
   

  	
  8.2

  	
  Risk of Loss

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
  INSURANCE AND LETTER OF CREDIT

  	
   

  

 

ii

 

	
   

  	
  9.1

  	
  Insurance

  	
   

  
	
   

  	
  9.2

  	
  Irrevocable Standby Letter of Credit

  	
   

  
	
   

  	
  9.3

  	
  Bechtel General Corporate Facts and Contractor
  Quarterly Confirmation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
  OWNERSHIP OF DOCUMENTATION

  	
   

  
	
   

  	
  10.1

  	
  Work Product, Contractor’s Intellectual Property
  and Third Party Proprietary Work Product

  	
   

  
	
   

  	
  10.2

  	
  Return/Delivery of Certain Property

  	
   

  
	
   

  	
  10.3

  	
  Contractor’s Right to Use of Work Product

  	
   

  
	
   

  	
  10.4

  	
  Owner Provided Documents

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 11

  	
  COMPLETION AND PERFORMANCE LIQUIDATED
  DAMAGES

  	
   

  
	
   

  	
  11.1

  	
  Notice of RFCD and Delivery of LNG for
  Commissioning, Start-Up and Performance Testing

  	
   

  
	
   

  	
  11.2

  	
  Delay in RFCD

  	
   

  
	
   

  	
  11.3

  	
  Notice and Requirements for Substantial Completion

  	
   

  
	
   

  	
  11.4

  	
  Owner Acceptance of RFCD and Substantial
  Completion

  	
   

  
	
   

  	
  11.5

  	
  Performance Liquidated Damages

  	
   

  
	
   

  	
  11.6

  	
  Punchlist

  	
   

  
	
   

  	
  11.7

  	
  Notice and Requirements for Final Completion

  	
   

  
	
   

  	
  11.8

  	
  Operations Activities

  	
   

  
	
   

  	
  11.9

  	
  Schedule Bonus

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
  WARRANTY AND CORRECTION OF WORK

  	
   

  
	
   

  	
  12.1

  	
  Warranty

  	
   

  
	
   

  	
  12.2

  	
  Correction of Work Prior to Substantial Completion

  	
   

  
	
   

  	
  12.3

  	
  Correction of Work After Substantial Completion

  	
   

  
	
   

  	
  12.4

  	
  Assignability of Warranties

  	
   

  
	
   

  	
  12.5

  	
  Waiver of Implied Warranties

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 13

  	
  DELAY LIQUIDATED DAMAGES

  	
   

  
	
   

  	
  13.1

  	
  Delay Liquidated Damages

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 14

  	
  CONTRACTOR’S REPRESENTATIONS

  	
   

  
	
   

  	
  14.1

  	
  Corporate Standing

  	
   

  
	
   

  	
  14.2

  	
  No Violation of Law; Litigation

  	
   

  
	
   

  	
  14.3

  	
  Licenses

  	
   

  
	
   

  	
  14.4

  	
  No Breach

  	
   

  
	
   

  	
  14.5

  	
  Corporate Action

  	
   

  
	
   

  	
  14.6

  	
  Financial Solvency

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 15

  	
  OWNER’S REPRESENTATIONS

  	
   

  
	
   

  	
  15.1

  	
  Standing

  	
   

  
	
   

  	
  15.2

  	
  No Violation of Law; Litigation

  	
   

  
	
   

  	
  15.3

  	
  Licenses

  	
   

  
	
   

  	
  15.4

  	
  No Breach

  	
   

  
	
   

  	
  15.5

  	
  Corporate Action

  	
   

  

 

iii

 

	
   

  	
  15.6

  	
  Financial Solvency

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 16

  	
  DEFAULT, TERMINATION AND SUSPENSION

  	
   

  
	
   

  	
  16.1

  	
  Default by Contractor

  	
   

  
	
   

  	
  16.2

  	
  Termination for Convenience by Owner

  	
   

  
	
   

  	
  16.3

  	
  Suspension of Work

  	
   

  
	
   

  	
  16.4

  	
  Suspension by Contractor

  	
   

  
	
   

  	
  16.5

  	
  Termination by Contractor

  	
   

  
	
   

  	
  16.6

  	
  Termination in the Event of Delayed Notice to
  Proceed

  	
   

  
	
   

  	
  16.7

  	
  Termination in the Event of an Extended Force
  Majeure

  	
   

  
	
   

  	
  16.8

  	
  Contractor’s Right to Terminate

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 17

  	
  INDEMNITIES

  	
   

  
	
   

  	
  17.1

  	
  General Indemnification

  	
   

  
	
   

  	
  17.2

  	
  Injuries to Contractor’s Employees and Damage to
  Contractor’s Property

  	
   

  
	
   

  	
  17.3

  	
  Injuries to Owner’s Employees and Damage to
  Owner’s Property

  	
   

  
	
   

  	
  17.4

  	
  Patent and Copyright Indemnification Procedure

  	
   

  
	
   

  	
  17.5

  	
  Lien Indemnification

  	
   

  
	
   

  	
  17.6

  	
  Owner’s Failure to Comply with Applicable Law

  	
   

  
	
   

  	
  17.7

  	
  Landowner Claims

  	
   

  
	
   

  	
  17.8

  	
  Legal Defense

  	
   

  
	
   

  	
  17.9

  	
  Enforceability

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 18

  	
  DISPUTE RESOLUTION

  	
   

  
	
   

  	
  18.1

  	
  Negotiation

  	
   

  
	
   

  	
  18.2

  	
  Arbitration

  	
   

  
	
   

  	
  18.3

  	
  Continuation of Work During Dispute

  	
   

  
	
   

  	
  18.4

  	
  Escrow of Certain Disputed Amounts By Owner

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 19

  	
  CONFIDENTIALITY

  	
   

  
	
   

  	
  19.1

  	
  Contractor’s Obligations

  	
   

  
	
   

  	
  19.2

  	
  Owner’s Obligations

  	
   

  
	
   

  	
  19.3

  	
  Definitions

  	
   

  
	
   

  	
  19.4

  	
  Exceptions

  	
   

  
	
   

  	
  19.5

  	
  Equitable Relief

  	
   

  
	
   

  	
  19.6

  	
  Term

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 20

  	
  LIMITATION OF LIABILITY

  	
   

  
	
   

  	
  20.1

  	
  Contractor Aggregate Liability

  	
   

  
	
   

  	
  20.2

  	
  Limitation on Contractor’s Liability for Liquidated
  Damages

  	
   

  
	
   

  	
  20.3

  	
  Liquidated Damages In General

  	
   

  
	
   

  	
  20.4

  	
  Consequential Damages

  	
   

  
	
   

  	
  20.5

  	
  Exclusive Remedies

  	
   

  
	
   

  	
  20.6

  	
  Applicability

  	
   

  
	
   

  	
  20.7

  	
  Term Limit

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 21

  	
  MISCELLANEOUS PROVISIONS

  	
   

  

 

iv

 

	
   

  	
  21.1

  	
  Entire Agreement

  	
   

  
	
   

  	
  21.2

  	
  Amendments

  	
   

  
	
   

  	
  21.3

  	
  Joint Effort

  	
   

  
	
   

  	
  21.4

  	
  Captions

  	
   

  
	
   

  	
  21.5

  	
  Notice

  	
   

  
	
   

  	
  21.6

  	
  Severability

  	
   

  
	
   

  	
  21.7

  	
  Assignment

  	
   

  
	
   

  	
  21.8

  	
  No Waiver

  	
   

  
	
   

  	
  21.9

  	
  Governing Law

  	
   

  
	
   

  	
  21.10

  	
  Successors and Assigns

  	
   

  
	
   

  	
  21.11

  	
  Attachments and Schedules

  	
   

  
	
   

  	
  21.12

  	
  Obligations

  	
   

  
	
   

  	
  21.13

  	
  Further Assurances

  	
   

  
	
   

  	
  21.14

  	
  Priority

  	
   

  
	
   

  	
  21.15

  	
  Restrictions on Public Announcements

  	
   

  
	
   

  	
  21.16

  	
  Potential Lenders, Potential Equity Investors and
  Equity Participants

  	
   

  
	
   

  	
  21.17

  	
  Foreign Corrupt Practices Act

  	
   

  
	
   

  	
  21.18

  	
  Language

  	
   

  
	
   

  	
  21.19

  	
  Counterparts

  	
   

  
	
   

  	
  21.20

  	
  Federal Energy Regulatory Commission Approval

  	
   

  
	
   

  	
  21.21

  	
  Owner’s Lender

  	
   

  
	
   

  	
  21.22

  	
  Independent Engineer

  	
   

  
	
   

  	
  21.23

  	
  Survival

  	
   

  

 

v

 

LIST OF
ATTACHMENTS AND SCHEDULES

 

	
  ATTACHMENT
  A

  	
  Scope
  of Work and Design Basis

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  A-1

  	
  Scope
  of Work

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  A-2

  	
  Design
  Basis

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  A-3

  	
  Conceptual
  Engineering Documents and Trends List

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  B

  	
  Contractor
  Deliverables

  
	
   

  	
   

  
	
  ATTACHMENT C

  	
  Payment Schedule

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  C-1

  	
  Milestone
  Payment Schedule

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  C-2

  	
  Monthly
  Payment Schedule

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  D

  	
  Form
  of Change Order

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  D-1

  	
  Change
  Order Form

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  D-2

  	
  Unilateral
  Change Order Form

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  D-3

  	
  Contractor’s
  Change Order Request Form/Contractor’s Response to a Change Order Proposed by
  Owner

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  D-4

  	
  Unit
  Rates for Change Orders Performed on a Time and Materials Basis

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  E

  	
  Project
  Schedule

  
	
   

  	
   

  
	
  ATTACHMENT
  F

  	
  Key
  Personnel and Contractor’s Organization

  
	
   

  	
   

  
	
  ATTACHMENT
  G

  	
  Approved
  Subcontractors and Sub-subcontractors and List of Major Equipment

  
	
   

  	
   

  
	
  ATTACHMENT
  H

  	
  Form
  of Limited Notice to Proceed and Notice to Proceed

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  H-1

  	
  Form
  of Limited Notice to Proceed

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  H-2

  	
  Form
  of Notice to Proceed

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  I

  	
  Form
  of Contractor’s Invoices

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  I-1

  	
  Form
  of Contractor’s Interim Invoice

  

 

vi

 

	
   

  	
  SCHEDULE
  I-2

  	
  Form
  of Contractor’s Final Invoice

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  J

  	
  HSE
  Plan Requirements

  
	
   

  	
   

  
	
  ATTACHMENT
  K

  	
  Form
  of Lien and Claim Waivers

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-1

  	
  Contractor’s
  Interim Conditional Lien Waiver

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-2

  	
  Contractor’s
  Interim Unconditional Lien Waiver

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-3

  	
  Subcontractor’s
  Interim Conditional Lien Waiver

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-4

  	
  Subcontractor’s
  Interim Unconditional Lien Waiver

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-5

  	
  Contractor’s
  Final Conditional Lien and Claim Waiver

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-6

  	
  Contractor’s
  Final Unconditional Lien and Claim Waiver

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-7

  	
  Subcontractor’s
  Final Conditional Lien and Claim Waiver

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  K-8

  	
  Subcontractor’s
  Final Unconditional Lien and Claim Waiver

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  L

  	
  Form
  of RFCD Completion Certificate

  
	
   

  	
   

  
	
  ATTACHMENT
  M

  	
  Form
  of Substantial Completion Certificate

  
	
   

  	
   

  
	
  ATTACHMENT
  N

  	
  Form
  of Final Completion Certificate

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  O

  	
  Insurance
  Requirements

  
	
   

  	
   

  
	
  ATTACHMENT
  P

  	
  Contractor
  Permits

  
	
   

  	
   

  
	
  ATTACHMENT
  Q

  	
  Owner
  Permits

  
	
   

  	
   

  
	
  ATTACHMENT
  R

  	
  Form
  of Irrevocable, Standby Letters of Credit

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  R-1

  	
  Form
  of Performance Letter of Credit

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  R-2

  	
  Form
  of Payment Letter of Credit

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  S

  	
  Performance
  Tests

  
	
   

  	
   

  
	
  ATTACHMENT
  T

  	
  Performance
  Guarantees, Performance Liquidated Damages, Minimum Acceptance Criteria and
  Delay Liquidated Damages

  
	
   

  	
   

  
	
  ATTACHMENT
  U

  	
  Owner-Provided
  Items and Responsibility

  
	
   

  	
   

  
	
  ATTACHMENT
  V

  	
  Pre-Commissioning,
  Commissioning, Start-Up and Training

  

 

vii

 

	
  ATTACHMENT
  W

  	
  Operating
  Spare Parts List

  
	
   

  	
   

  
	
  ATTACHMENT
  X

  	
  [Not
  Used.]

  
	
   

  	
   

  
	
  ATTACHMENT
  Y

  	
  Site
  and Off-Site Rights of Way and Easements

  
	
   

  	
   

  
	
  ATTACHMENT
  Z

  	
  [Not
  Used.]

  
	
   

  	
   

  
	
  ATTACHMENT
  AA

  	
  Form
  of Acknowledgement and Consent Agreement with Lender

  
	
   

  	
   

  
	
  ATTACHMENT
  BB

  	
  Form
  of Contractor and Owner Confirmations

  
	
   

  	
   

  
	
   

  	
  SCHEDULE
  BB-1

  	
  Form
  of Contractor Quarterly Confirmation

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  BB-2

  	
  Form
  of Owner Monthly Confirmation

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE
  BB-3

  	
  Form
  of Owner Quarterly Confirmation

  
	
   

  	
   

  	
   

  
	
  ATTACHMENT
  CC

  	
  Independent
  Engineer Activities

  
	
   

  	
   

  
	
  ATTACHMENT
  DD

  	
  Form
  of Escrow Agreement

  
	
   

  	
   

  
	
  ATTACHMENT
  EE

  	
  Stainless
  Steel Adjustment, Tank Subcontract Materials Adjustment, Marine Loading Arm
  Adjustment and BOG Compressor Adjustment

  

 

viii

 

SABINE
PASS LNG RECEIVING,

STORAGE
AND REGASIFICATION TERMINAL

ENGINEERING,
PROCUREMENT AND CONSTRUCTION AGREEMENT

 

THIS
ENGINEERING, PROCUREMENT AND CONSTRUCTION AGREEMENT (this “Agreement”), dated as of the 18th
Day of December, 2004 (the “Contract Date”),
is entered into by and between SABINE PASS LNG, L.P.,
a Delaware limited partnership, having its principal place of business at 717
Texas Avenue, Suite 3100, Houston, Texas 77002 (“Owner”),
and BECHTEL CORPORATION, a Nevada
corporation, having an address at 3000 Post Oak Boulevard, Houston, Texas 77056
(“Contractor” and, together with
Owner, each a “Party” and together the “Parties”).

 

RECITALS

 

WHEREAS, Owner
desires to enter into an agreement with Contractor to provide services for the
engineering, procurement and construction of a turnkey LNG receiving, storage
and regasification terminal to be owned by Owner, located near the town of
Johnson’s Bayou in Cameron Parish, Louisiana, and all related appurtenances
thereto (as more fully described below, the “Facility”
or “Project”), and to commission,
start-up and test the Facility, all as further described herein; and

 

WHEREAS, Contractor,
itself or through its vendors, suppliers, and subcontractors, desires to
provide the foregoing engineering, procurement, construction, commissioning,
start-up and testing services on a turnkey lump sum basis;

 

NOW
THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Parties, intending to be legally
bound, hereby agree as follows:

 

Article 1

DEFINITIONS

 

1.1                                 In
addition to other defined terms used throughout this Agreement, when used
herein, the following capitalized terms have the meanings specified in this
Section 1.1.

 

“AAA” has the meaning set forth in
Section 18.2.

 

“AAA Rules” has the meaning set forth
in Section 18.2.

 

“Acceleration Schedule” has the
meaning set forth in Section 5.6A.

 

“Actual Insurance Cost” has
the meaning set forth in Section 7.1B.

 

“Administrative Agent” means the
administrative agent under the credit agreement for the financing of the
Project.

 

“Advance Payment” has the
meaning set forth in Section 7.2A.

 

 

“Affiliate” means any Person
that directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with a Party.  For purposes of this definition, “control”
(including, with correlative meanings, the terms “controlled by” and “under
common control with”) means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities or otherwise.

 

“Agreement” means this Agreement for
the performance of the Work (including all Attachments and Schedules attached
hereto), as it may be amended from time to time in accordance with this
Agreement.

 

“Applicable Codes and Standards”
means any and all codes, standards or requirements applicable to the Work set
forth or listed in Attachment A, in any Applicable Law (subject to an
adjustment by Change Order in accordance with Section 6.2A.1), or which are set
forth or listed in any document or Drawing listed in Attachment A, which
codes, standards and requirements shall govern Contractor’s performance of the
Work, as provided herein, provided that,
with respect to Applicable Codes and Standards which are not set forth in any
Applicable Law, any reference herein to Applicable Codes and Standards shall be
deemed only to refer to such Applicable Codes and Standards in existence as of
the Contract Date.

 

“Applicable Law” means all laws,
statutes, ordinances, orders, decrees, injunctions, licenses, Permits,
approvals, rules and regulations, including any conditions thereto, of any
Governmental Instrumentality having jurisdiction over all or any portion of the
Site or the Facility or performance of all or any portion of the Work or the
operation of the Facility, or other legislative or administrative action of a
Governmental Instrumentality, or a final decree, judgment or order of a court
which relates to the performance of Work hereunder.

 

“Bechtel General Corporate Facts” has
the meaning set forth in Section 9.3.

 

“BOG Compressor Adjustment”
has the meaning set forth in Section 7.1G.

 

“Boil-Off” means Natural Gas which
comes out of a liquid phase into a gas phase in various locations within the
Facility (except Natural Gas produced by the vaporizers), and is collected in
the boil-off or vapor handling system.

 

“Books and Records” has the
meaning set forth in Section 3.13A.

 

“Business Day” means every Day other
than a Saturday, a Sunday or a Day that is an official holiday for employees of
the federal government of the United States of America.

 

“CAD” has the meaning set forth in
Section 3.3E.

 

“Change Order” means, after the
execution of this Agreement, any of the following: (i) a written order issued
by Owner to Contractor, in the form of Schedule D-2, (ii) a written
instrument signed by both Parties in the form of Schedule D-1, in each
case executed pursuant to the applicable provisions of Article 6, or (iii) a
determination issued pursuant to Article 18, that authorizes an addition to,
deletion from, suspension of, or any other

 

2

 

modification or
adjustment to the requirements of this Agreement, including the Work or any
Changed Criteria.

 

“Changed Criteria” has the meaning
set forth in Section 6.1A.

 

“Changes in Law” means any amendment,
modification, superseding act, deletion, addition or change in or to Applicable
Law (excluding changes to tax laws where such taxes are based upon Contractor’s
income or profits/losses) that occurs and takes effect after the Contract
Date.  A Change in Law shall include any
official change in the interpretation or application of Applicable Law
(including Applicable Codes and Standards set forth in Applicable Law), provided that such change is expressed in writing by the
applicable Governmental Instrumentality.

 

“Cheniere” means Cheniere Energy,
Inc.

 

“Collateral Agent” means the
collateral agent under the credit agreement for the financing of the Project.

 

“Confidential Information” has the
meaning set forth in Section 19.3.

 

“Confirmed Acceleration Directive”
has the meaning set forth in Section 5.6A.

 

“Consequential Damages” has the
meaning set forth in Section 20.4.

 

“Construction Equipment” means the
equipment, machinery, structures, scaffolding, materials, tools, supplies and
systems owned, rented or leased by Contractor or its Subcontractors or
Sub-subcontractors for use in accomplishing the Work, but not intended for
incorporation into the Facility.

 

“Construction Equipment Lessor” means
the Subcontractor or Sub-subcontractor, as the case may be, who rents or leases
Construction Equipment.

 

“Contract Date” has the meaning set
forth in the preamble.

 

“Contract Price” has the meaning set
forth in Section 7.1, as may be adjusted by Change Order in accordance with the
terms of this Agreement.

 

“Contractor” has the meaning set
forth in the preamble hereto.

 

“Contractor Group” means (i)
Contractor and its Affiliates and (ii) the respective directors, officers,
agents, employees, representatives of each Person specified in clause (i)
above.

 

“Contractor Permits” means the
Permits listed in Attachment P and any other Permits (not listed in
either Attachment P or Attachment Q) necessary for performance of
the Work which are required to be obtained in Contractor’s name pursuant to
Applicable Law.

 

“Contractor Quarterly Confirmation”
has the meaning set forth in Section 9.3.

 

3

 

“Contractor Representative” means
that Person or Persons designated by Contractor in a written notice to Owner
specifying any and all limitations of such Person’s authority, and acceptable
to Owner, who shall have complete authority to act on behalf of Contractor on
all matters pertaining to this Agreement or the Work including giving
instructions and making changes in the Work. 
The Contractor Representative as of the Contract Date is designated in
Section 2.2B.

 

“Contractor’s Confidential Information”
has the meaning set forth in Section 19.2.

 

“Contractor’s Intellectual Property”
has the meaning set forth in Section 10.1A.

 

“Cool Down” means the controlled
process by which a process system is taken from its ambient condition (purged
and cleaned of air, moisture and debris, etc.) and cooled down to its cryogenic
temperature (at or below - 260°F) through the use of LNG, which shall be set
forth in the Project Commissioning Plan. 
A system has achieved “Cool Down” when it has reached its cryogenic
temperature in a stable condition.

 

“Corrective Work” has the meaning set
forth in Section 12.3.

 

“CPM Schedule” has the meaning set
forth in Section 5.4.

 

“Day” means a calendar day.

 

“Default” has the meaning set forth
in Section 16.1A.

 

“Defect” or “Defective”
has the meaning set forth in Section 12.1A.

 

“Defect Correction Period” means the
period commencing upon Substantial Completion and ending eighteen (18) months
thereafter.

 

“Delay Liquidated Damages” has the
meaning set forth in Section 13.1C.

 

“Design Basis” means the basis of
design and technical limits and parameters of the Facility as set forth in Schedule
A-2.

 

“Disclosing Party” has the meaning
set forth in Section 19.3.

 

“Dispute” has the meaning set forth
in Section 18.1.

 

“Dispute Notice” has the meaning set
forth in Section 18.1.

 

“Drawings” means the graphic and
pictorial documents showing the design, location and dimensions of the
Facility, generally including plans, elevations, sections, details, schedules
and diagrams, which are prepared as a part of and during the performance of the
Work.

 

“Effective Date” means the date on
which Owner issues the Limited Notice to Proceed in accordance with Section 5.2A.

 

4

 

“Equipment” means all equipment,
materials, supplies, software, licenses and systems required for the completion
of and incorporation into the Facility.

 

“Escrow Agent” means the escrow agent
under the Escrow Agreement.

 

“Escrow Agreement” means the escrow
agreement between Owner, Escrow Agent and Contractor, which shall be in the
form attached hereto as Attachment DD.

 

“Escrowed Amounts” has the meaning
set forth in Section 18.4.

 

“Excessive Monthly Precipitation”
means that the total precipitation measured at the Site for the Month that the
event in question occurred has exceeded the following selected probability
levels for such Month for Weather Station 417174 BPT, Port Arthur AP Beaumont
TX, as specified in the National Oceanic and Atmospheric Administration
publication titled “Climatography of the U.S. No. 81, Supplement No. 1, Monthly
Precipitation Probabilities and Quintiles, 1971-2000.”:

 

(1)                                  For
the period from Contractor’s mobilization to the Site until completion of the
last Tank pile cap, the selected probability level of 0.6 shall apply; and

 

(2)                                  For
all other periods after Contractor’s mobilization to the Site, the selected
probability level of 0.8 shall apply.

 

The Parties recognize
that the assessment as to whether or not total precipitation measured at the
Site for a given Month constitutes Excessive Monthly Precipitation can only be
made after the end of the Month in question.

 

“Facility” means the facilities
contemplated in this Agreement (including the Scope of Work), including the LNG
receiving, storage and regasification facilities to be engineered, procured,
constructed, pre-commissioned, commissioned and tested by Contractor under this
Agreement.

 

“FERC” means the Federal Energy
Regulatory Commission.

 

“FERC
Authorization” means the authorization by the FERC
granting to Owner the approvals requested in that certain application filed by
Owner with the FERC on December 22, 2003, in Docket No. CP04-47-000 (as may be
amended from time to time) pursuant to Section 3(a) of the Natural Gas Act and
the corresponding regulations of the FERC.

 

“Final Completion” means that all
Work and all other obligations under this Agreement (except for that Work and
obligations that survive the termination or expiration of this Agreement,
including obligations for Warranties and correction of Defective Work pursuant
to Section 12.3 and any other obligations covered under Section 11.7), are
fully and completely performed in accordance with the terms of this Agreement,
including: (i) the achievement of Substantial Completion; (ii) any and all
Liquidated Damages due and owing have been paid to Owner in accordance with
Section 20.3C; (iii) the completion of all Punchlist items; (iv) delivery by
Contractor to Owner of a fully executed Final

 

5

 

Conditional Lien and
Claim Waiver in the form of Schedule K-5; (v) delivery by Contractor to
Owner of all documentation required to be delivered under this Agreement as a
prerequisite of achievement of Final Completion, including Record Drawings;
(vi) removal from the Site of all of Contractor’s, Subcontractors’ and
Sub-subcontractor’s personnel, supplies, waste, materials, rubbish, and
temporary facilities; (vii) delivery by Contractor to Owner of fully executed
Final Conditional Lien and Claim Waivers from all Major Subcontractors in the
form in Attachment K-7; (viii) fully executed Final Conditional Lien and
Claim Waivers from Major Sub-subcontractors in a form substantially similar to
the form in Attachment K-7; (ix) delivery by Contractor to Owner of a
Final Completion Certificate in the form of Attachment N and as required
under Section 11.7; and (x) Contractor has, pursuant to Section 3.4, delivered
to the Project all Operating Spare Parts required by the Operating Spare Parts
List to be delivered to the Project prior to Final Completion.

 

“Final Completion Certificate” has
the meaning set forth in Section 11.7.

 

“Final Conditional Lien and Claim Waiver”
means the waiver and release provided to Owner by Contractor, Major
Subcontractors and Major Sub-subcontractors in accordance with the requirements
of Section 7.3, which shall be in the form of Attachment K, Schedules
K-5 and K-7.

 

“Final Unconditional Lien and Claim Waiver”
means the waiver and release provided to Owner by Contractor, Major
Subcontractors and Major Sub-subcontractors in accordance with the requirements
of Section 7.3, which shall be in the form of Attachment K, Schedules
K-6 and K-8.

 

“First Draw” has the meaning set
forth in Section 4.1A.

 

“Force Majeure” means any act or
event that (i) prevents or delays the
affected Party’s performance of its obligations in accordance with the terms of
this Agreement, (ii) is beyond the reasonable control of the affected Party,
not due to its fault or negligence and (iii) could not have been prevented or
avoided by the affected Party through the exercise of due diligence.  Force Majeure may include catastrophic storms
or floods, Excessive Monthly Precipitation, lightning, tornadoes, hurricanes, a
named tropical storm, earthquakes and other acts of God, wars, civil disturbances,
revolution, acts of public enemy, acts of terrorism, credible threats of terrorism,
revolts, insurrections, sabotage, riot, plague, epidemic, commercial embargoes,
expropriation or confiscation of the Facility, epidemics, fires, explosions,
industrial action or strike (except as excluded below), and actions of a
Governmental Instrumentality that were not requested, promoted, or caused by
the affected Party.  For avoidance of
doubt, Force Majeure shall not include any of the following: (i) economic hardship
unless such economic hardship was otherwise caused by Force Majeure; (ii)
changes in market conditions unless any such change in market conditions was
otherwise caused by Force Majeure; (iii) industrial actions and strikes
involving only the employees of Contractor or any of its Subcontractors, except
for industrial actions and strikes involving the employees of the
Sub-subcontractor supplying the nickel steel for the Tanks; or (iv)
nonperformance or delay by Contractor or its Subcontractors or Sub-subcontractors,
unless such nonperformance or delay was otherwise

 

6

 

caused by Force
Majeure.

 

“GAAP” means generally accepted
accounting principles.

 

“Geotechnical Reports” means the
following reports, each prepared by Tolunay-Wong Engineers, Inc. and provided
by Owner to Contractor prior to the Contract Date: (i) the Geotechnical
Investigation, Sabine LNG Terminal, Cryogenic Tanks, Sabine, Louisiana, dated
September 12, 2003; (ii) the Final Report, Geotechnical Investigation, Sabine
LNG Terminal, Process Area, LNG Pipe Racks, Berth and Construction Docks,
Sabine, Louisiana, dated September 19, 2003; and (iii) Geological Hazard
Evaluation, Sabine LNG Terminal, Sabine, Louisiana, dated September 19, 2003.

 

“Good Engineering and Construction Practices”
or “GECP” means the generally accepted
practices, skill, care, methods, techniques and standards employed by the
international LNG industry at the time of the Contract Date that are commonly
used in prudent engineering, procurement and construction to safely design,
construct, pre-commission, commission, start-up and test LNG related facilities
of similar size and type as the Facility, in accordance with Applicable Law and
Applicable Codes and Standards.

 

“Governmental Instrumentality” means
any federal, state or local department, office, instrumentality, agency, board
or commission having jurisdiction over a Party or any portion of the Work, the
Facility or the Site.

 

“Guarantee Conditions” means the
Sendout Rate Guarantee Conditions and Ship Unloading Time Guarantee Conditions.

 

“Guaranteed Substantial Completion Date”
has the meaning set forth in Section 5.3A as may be adjusted by Change Order in
accordance with the terms of this Agreement.

 

“Hazardous Materials” means any
substance that under Applicable Law is considered to be hazardous or toxic or
is or may be required to be remediated, including (i) any petroleum or
petroleum products, radioactive materials, asbestos in any form that is or
could become friable, urea formaldehyde foam insulation, transformers or other
equipment that contain dielectric fluid containing polychlorinated biphenyls
and processes and certain cooling systems that use chlorofluorocarbons, (ii)
any chemicals, materials or substances which are now or hereafter become
defined as or included in the definition of “hazardous substances,” “hazardous
wastes,” “hazardous materials,” “extremely hazardous wastes,” “restricted
hazardous wastes,” “toxic substances,” “toxic pollutants,” or any words of similar
import pursuant to Applicable Law, or (iii) any other chemical, material,
substance or waste, exposure to which is now or hereafter prohibited, limited
or regulated by any Governmental Instrumentality, or which may be the subject
of liability for damages, costs or remediation.

 

“HSE Plan” has the meaning set forth
in Section 3.10A.

 

“Indemnified Party” means any member
of the Owner Group or the Contractor Group, as the context requires.

 

7

 

“Indemnifying Party” means Owner or
Contractor, as the context requires.

 

“Independent Engineer” means the
engineer(s) employed by Lender.

 

“Insurance Allowance” has the meaning
set forth in Section 7.1B.

 

“Interim Conditional Lien Waiver”
means the conditional waiver and release provided to Owner by Contractor, Major
Subcontractors and Major Sub-subcontractors in accordance with the requirements
of Section 7.2D, which shall be in the form of Attachment K, Schedules
K-1 and K-3.

 

“Interim Unconditional Lien Waiver”
means the unconditional waiver and release provided to Owner by Contractor,
Major Subcontractors and Major Sub-subcontractors in accordance with the
requirements of Section 7.2D, which shall be in the form of Attachment
K, Schedules K-2 and K-4.

 

“Insolvency Event” in relation to any
Party means the bankruptcy, insolvency, liquidation, administration,
administrative or other receivership or dissolution of such Party, and any
equivalent or analogous proceedings by whatever name known and in whatever
jurisdiction, and any step taken (including, without limitation, the
presentation of a petition or the passing of a resolution or making a general
assignment or filing for the benefit of its creditors) for or with a view
toward any of the foregoing.

 

“Invoice” means Contractor’s request
for a payment pursuant to Section 7.2, which invoice shall be in the form
of Attachment I.

 

“Key Personnel” or “Key Persons” has the meaning set
forth in Section 2.2A.

 

“Landowner” means any landowner that
has leased land or provided a right of way or easement to Owner in connection
with the Project.

 

“Lender” means any entity or entities
providing temporary or permanent debt financing to Owner for the Facility.

 

“Letter of Credit” has the meaning
set forth in Section 9.2.

 

“Level II” means
a level of detail in the CPM Schedule that has two hundred (200) to three
hundred (300) activities and has logical relationships at a summary level. The
work breakdown structure in the Level II CPM Schedule is by Project phase
(engineering, procurement, construction, startup and commissioning) and
discipline/commodity (process engineering, mechanical engineering, etc. for
engineering disciplines and Site work, concrete, steel, piping, etc. for
construction).  Critical major Equipment
(including bulk material requirements) and Subcontract procurement and
deliveries are captured in the Level II CPM Schedule. All major schedule milestones
are shown.  The Level II CPM Schedule may
be resource loaded to check staffing levels or installation rates.

 

“Level III” means
a level of detail in the CPM Schedule which is an implementation (control)
schedule used to direct the Work by providing schedule parameters to the more

 

8

 

detailed
implementation level, identify and resolve schedule problems, status progress
in terms of Milestones, measure the impact of scope changes and delays, develop
recovery plans, and support schedule-related contractual action.  The work breakdown structure in the Level III
CPM Schedule is at an area level (common area, turbine generator area,
vaporizer area, Tanks, pipe racks, etc.), and shall involve over one thousand
(1,000) activities.  The Level III CPM
Schedule is developed with the assistance of and accepted by Contractor’s Key
Personnel. The deliverables by each engineering discipline are captured at this
level.  All major Equipment (including
bulk material requirements) are scheduled at area level and detailed
construction activities at each commodity level follow the same area concept.  The Subcontract schedules are similarly
developed for each area, as applicable.

 

“Limited Notice to Proceed” or “LNTP” has the meaning set forth in
Section 5.1.

 

“Liquidated Damages” means Delay
Liquidated Damages and Performance Liquidated Damages.

 

“LNG” means liquefied Natural Gas.

 

“LNTP Work” has the meaning set forth
in Section 11 of Attachment A.

 

“LDEQ” means the Louisiana Department
of Environmental Quality.

 

“Louisiana Sales and Use Tax” has the
meaning set forth in Section 4.5A.

 

“Louisiana Sales and Use Tax Allowance”
has the meaning set forth in Section 7.1A.

 

“Major Equipment” means the items of
Equipment listed as such in Attachment G.

 

“Major Subcontract” means any
Subcontract having an aggregate value in excess of Five Million U.S. Dollars
(U.S.$5,000,000) and any Subcontract listed in Attachment G as a
Subcontract for a specified critical element of the Work even if the
Subcontract aggregate value is less than Five Million U.S. Dollars
(U.S.$5,000,000).

 

“Major Subcontractor” means the Subcontractors
listed as such in Attachment G and, in addition, any Subcontractor with
whom Contractor enters, or intends to enter, into a Major Subcontract.

 

“Major Sub-subcontract” means any
Sub-subcontract with a Sub-subcontractor listed in Attachment G.

 

“Major Sub-subcontractor” means the
Sub-subcontractors listed as such in Attachment G.

 

“Marine Loading Arm Adjustment”
has the meaning set forth in Section 7.1F.

 

“Memorandum of Understanding” means
the Memorandum of Understanding between Cheniere LNG, Inc., Cheniere and
Contractor, dated August 22, 2003.

 

9

 

“Milestone” means a designated
portion of the Work, as shown in Attachment C,  Schedule C-1.

 

“Minimum Acceptance Criteria” or “MAC” means the Sendout Rate MAC and
the Ship Unloading Time MAC.

 

“Minimum Acceptance Criteria Correction Period”
has the meaning set forth in Section 11.5B.

 

“MMSCFD” means million SCFD.

 

“Month” means a Gregorian calendar
month; “month” means any period of
thirty (30) consecutive Days.

 

“Monthly” means an event occurring or
an action taken once every Month.

 

“Monthly Payments” has the meaning
set forth in Section 7.2B.

 

“Monthly Progress Reports” has the
meaning set forth in Section 3.19A.3.

 

“Natural Gas” means combustible gas consisting
primarily of methane.

 

“Notice to Proceed” or “NTP” has the meaning set forth in
Section 5.2B.

 

“Off-Site Rights of Way and Easements”
has the meaning set forth in Section 4.3B.

 

“Operating Spare Part Allowance” has
the meaning set forth in Section 7.1C.

 

“Operating Spare Parts” has the
meaning set forth in Section 3.4.

 

“Operating Spare Parts List” has the
meaning set forth in Section 3.4.

 

“Operations Activity” or “Operations Activities” has the
meaning set forth in Section 11.8.

 

“Owner” has the meaning set forth in
the preamble hereto.

 

“Owner Default” has the meaning set
forth in Section 16.5.

 

“Owner Group” means (i) Owner, its
parent, Lender, and each of their respective Affiliates and (ii) the respective
directors, officers, agents, employees and representatives of each Person
specified in clause (i) above.

 

“Owner Monthly Confirmation” has the
meaning set forth in Section 4.1A.

 

“Owner Permits” means the Permits
listed in Attachment Q and any other Permits (not listed in either Attachment
P or Attachment Q) necessary for performance of the Work or the
operation of the Facility and which are required to be obtained in Owner’s name
pursuant to Applicable Law.

 

10

 

“Owner Quarterly Confirmation” has
the meaning set forth in Section 4.1B.

 

“Owner Representative” means that
Person or Persons designated by Owner in a written notice to Contractor who
shall have complete authority to act on behalf of Owner on all matters
pertaining to the Work, including giving instructions and making changes in the
Work.  Owner designates Ed Lehotsky as
the Owner Representative.  Notification
of a change in Owner Representative shall be provided in advance, in writing,
to Contractor.

 

“Owner’s Confidential Information”
has the meaning set forth in Section 19.1.

 

“P&ID’s” means piping and
instrumentation diagrams.

 

“Party” or “Parties”
means Owner and/or Contractor and their successors and permitted assigns.

 

“Payment Schedule” means the schedule
of Milestone payments as set forth in Attachment C, Schedule C-1,
and the schedule of Monthly Payments set forth in Attachment C, Schedule
C-2.

 

“Payment Letter of Credit” has the
meaning set forth in Section 9.2.

 

“Performance Guarantee(s)” means the
Sendout Rate Performance Guarantee and the Ship Unloading Time Performance
Guarantee.

 

“Performance Letter of Credit” has the
meaning set forth in Section 9.2.

 

“Performance Liquidated Damages”
means the Sendout Rate Performance Liquidated Damages and the Ship Unloading
Time Performance Liquidated Damages.  The
Performance Liquidated Damages are shown in Attachment T.

 

“Performance Test Procedures” has the
meaning set forth in Section 11.3.

 

“Performance Tests” means the tests
performed (including any repetition thereof) to determine whether the Facility
meets the Performance Guarantees and/or Minimum Acceptance Criteria set forth
in Attachment T, which tests shall be as specified in and consistent
with Attachment S.

 

“Permit” means any valid waiver,
certificate, approval, consent, license, exemption, variance, franchise,
permit, authorization or similar order or authorization from any Governmental
Instrumentality required to be obtained or maintained in connection with the
Facility, the Site or the Work.

 

“Person” means any individual,
company, joint venture, corporation, partnership, association, joint stock
company, limited liability company, trust, estate, unincorporated organization,
Governmental Instrumentality or other entity having legal capacity.

 

“Potential Lender” has the meaning
set forth in Section 21.16A.

 

11

 

“Progress Record Drawings and Specifications”
means Drawings and Specifications that show all current “as-built” conditions,
as required under Attachment B.

 

“Project” has the meaning specified
for “Facility.”

 

“Project Commissioning Plan” means
the detailed plan which shall be provided by Contractor to Owner in accordance
with Attachment V.

 

“Project Insurances” has the meaning
set forth in Section 7.1B.

 

“Project Schedule” means the schedule
for performance of the Work, including the date for LNTP, the date for NTP, the
Target Bonus Date and the Guaranteed Substantial Completion Date, as more
particularly described in Attachment E.

 

“PSIG” means pounds per square inch,
gauge.

 

“Punchlist” means a list of those
finishing items required to complete the Work, the completion of which shall
not materially interrupt nor affect the safe operation of all or any part of
the Facility after RFCD or Substantial Completion, as more fully described in
Section 11.6 of this Agreement.

 

“Qualified Research Expenditures”
means the costs funded by Owner under this Agreement that are incurred in
connection with Work performed by Contractor, its Subcontractors and
Sub-subcontractors which meet all of the requirements of Section 41(d)(1) of
the Internal Revenue Code of 1986, as amended, and which are related to the
development or improvement of a business component of the Facility.

 

“Ready For Cool Down” or “RFCD” means that all of the
following have occurred: (i) Contractor has completed all applicable Work,
other than the Work meeting the definition of Punchlist, in accordance with the
requirements contained in this Agreement to ensure that System 1, the first
System to undergo Cool Down, is ready for use to receive and dispatch LNG and
Natural Gas so that the Cool Down phase can commence; and (ii) Contractor has
delivered to Owner a RFCD Completion Certificate for such System in the form of
Attachment L as required under Section 11.1A.

 

“Ready for Performance Testing” means
that all of the following have occurred with respect to the Facility: (i) Cool
Down has been completed for System 1, System 2, and System 3; (ii) all Tanks
have been successfully filled to their high levels (but not simultaneously);
(iii) all vaporizers have been operated individually; (iv) Contractor has
completed all procurement, fabrication, assembly, erection, installation and
pre-commissioning checks and tests of the Facility to ensure that the entire
Work and each component thereof was sufficiently fabricated, assembled, erected
and installed so as to be capable of being operated safely within the
requirements contained in this Agreement; and (v) all portions of the Facility
have attained the state of completion necessary for commencement of the Sendout
Rate Performance Test.

 

“Receiving Party” has the meaning set
forth in Section 19.3.

 

12

 

“Record Drawings and Specifications”
means final, record Drawings and Specifications of the Facility showing the “as-built”
conditions of the completed Facility, as required under Attachment B.

 

“Recovery Schedule” has the meaning
set forth in Section 5.5.

 

“Reimbursable Costs” means the Unit
Rates, other direct costs and applicable markups and allowances set forth in Schedule
D-4.

 

“RFCD Completion Certificate” has the
meaning set forth in Section 11.1A.

 

“RFCD Delay Liquidated Damages” has
the meaning set forth in Section 13.1A.

 

“Safety Standards” has the meaning
set forth in Section 3.10A.

 

“SCF” means standard cubic feet.

 

“SCFD” means standard cubic feet per
Day.

 

“Schedule Bonus” has the meaning set
forth in Section 11.9.

 

“Scope of Work” means the description
of Work to be performed by Contractor as set forth in this Agreement, including
as more specifically set forth in Attachment A.

 

“SEC” means the Securities and
Exchange Commission or any successor entity thereto.

 

“Sendout Rate” has the meaning set
forth in Attachment T.

 

“Sendout Rate Guarantee Conditions”
has the meaning set forth in Attachment T.

 

“Sendout Rate MAC” has the meaning
set forth in Attachment T.

 

“Sendout Rate Performance Guarantee”
has the meaning set forth in Attachment T.

 

“Sendout Rate Performance Liquidated Damages”
has the meaning set forth in Attachment T.

 

“Ship Unloading Time” has the meaning
set forth in Attachment T.

 

“Ship Unloading Time Guarantee Conditions”
has the meaning set forth in Attachment T.

 

“Ship Unloading Time MAC” has the
meaning set forth in Attachment T.

 

“Ship Unloading Time Performance Guarantee”
has the meaning set forth in Attachment T.

 

“Ship Unloading Time Performance Liquidated Damages”
has the meaning set forth in Attachment T.

 

13

 

“Site” means those areas shown in
greater detail in Attachment Y.

 

“Specifications” means those
documents consisting of the written requirements for Equipment, standards and
workmanship for the Work, which are prepared as a part of and during the
performance of the Work.

 

“Stainless Steel Adjustment” has the
meaning set forth in Section 7.1D.

 

“Subcontract” means an agreement by
Contractor with a Subcontractor for the performance of any portion of the Work.

 

“Subcontractor” means any Person,
including an Equipment supplier or vendor, who has a direct contract with
Contractor to manufacture or supply Equipment which is a portion of the Work,
to lease Construction Equipment to Contractor in connection with the Work, or
to otherwise perform a portion of the Work.

 

“Substantial Completion” means that
all of the following have occurred with respect to the Facility: (i) all
Minimum Acceptance Criteria have been achieved; (ii) all Performance Guarantees
for the Facility have been achieved, or in the case that all Performance
Guarantees have not been achieved but all Minimum Acceptance Criteria have been
achieved, Contractor has paid Performance Liquidated Damages in accordance with
Section 20.3C (except such Performance Liquidated Damages that are not due as a
condition of Substantial Completion if Contractor, at Owner’s election, is
taking corrective actions under Section 11.5A(i)); (iii) any Substantial
Completion Delay Liquidated Damages due and owing have been paid in accordance
with Section 20.3C; (iv) the Work (including training in accordance with
Section 3.5 and the delivery of all documentation required as a condition of
Substantial Completion under this Agreement (including documentation required
for operation, including test reports)) has been completed in accordance with
the requirements of this Agreement other than any Work which meets the
definition of Punchlist; (v) Contractor has delivered to Owner the Substantial
Completion Certificate in the form of Attachment M, as required under
Section 11.3; (vi) Contractor has obtained all Contractor Permits for the Facility;
and (vii) Contractor has, pursuant to Section 3.4, delivered to the
Project all Operating Spare Parts required by the Operating Spare Parts List to
be delivered to the Project prior to Substantial Completion.

 

“Substantial Completion Certificate”
has the meaning set forth in Section 11.3.

 

“Substantial Completion Delay Liquidated Damages”
has the meaning set forth in Section 13.1B.

 

“Sub-subcontract” means any agreement
by a Subcontractor with a Sub-subcontractor or by a Sub-subcontractor with another
Sub-subcontractor for the performance of any portion of the Work.

 

“Sub-subcontractor” means any Person,
including an Equipment supplier or vendor, who has a direct or indirect
contract with a Subcontractor or another Sub-subcontractor to manufacture or
supply Equipment which comprises a portion of the Work, to lease Construction
Equipment to Subcontractor or another
Sub-subcontractor in connection with

 

14

 

the Work, to
perform a portion of the Work or to otherwise furnish labor or materials.

 

“Subsurface Soil Conditions” means
subsurface conditions at the Site, including subsurface conditions on the sea
bottom of the dredging basin where Work shall be performed.

 

“System” means a System of the
Facility, being System 1, System 2 or System 3. 
System 1, 2 and 3 shall compose the entire Facility.

 

“System 1” means the first System to
undergo Cool Down and is comprised of all components of the Facility, with the
exception of System 2 and System 3.

 

“System 2” means Tank 2.

 

“System 3” means Tank 3.

 

“Tank” means any of Tank 1, Tank 2 or
Tank 3.

 

“Tank 1” means the first LNG storage
tank to be constructed by Contractor.

 

“Tank 2” means the second LNG storage
tank to be constructed by Contractor.

 

“Tank 3” means the third LNG storage
tank to be constructed by Contractor.

 

“Tank Subcontract Materials Adjustment”
has the meaning set forth in Section 7.1E.

 

“Target Bonus Date” means the date
specified in Attachment E as may be adjusted by Change Order in
accordance with the terms of this Agreement.

 

“Target Completion” means that all of
the following have occurred with respect to the Facility: (i) Cool Down has
been completed for System 1 and System 2; (ii) Contractor has completed all
procurement, fabrication, assembly, erection, installation and precommissioning
checks of all of the vaporizers for the Facility to ensure that all such
vaporizers and each component thereof was sufficiently fabricated, assembled,
erected and installed so as to be capable of being operated safely within the
requirements contained in this Agreement, and thirteen vaporizers have been
operated to their rated capacity; (iii) Contractor has completed all
procurement, fabrication, assembly, erection, installation and
pre-commissioning checks and tests of System 1 and System 2 to ensure that
these Systems and each component thereof was sufficiently fabricated,
assembled, erected and installed so as to be capable of being operated safely
within the requirements contained in this Agreement; and (iv) System 1 and
System 2 collectively achieve a
Sendout Rate of 2,000 MMSCFD or above at a temperature of no less than 40°F and
at a pressure of no less than 1,250 PSIG, as measured at the exit for the main
Facility transfer meter, for a continuous period of a minimum of twenty-four
(24) hours.

 

“Taxes” means any and all taxes,
assessments, levies, duties, fees, charges and withholdings of any kind or
nature whatsoever and howsoever described, including Louisiana Sales and Use
Taxes, value-added, sales, use, gross receipts, license, payroll,

 

15

 

federal, state,
local or foreign income, environmental, profits, premium, franchise, property,
excise, capital stock, import, stamp, transfer, employment, occupation, generation,
privilege, utility, regulatory, energy, consumption, lease, filing, recording
and activity taxes, levies, duties, fees, charges, imposts and withholding,
together with any and all penalties, interest and additions thereto.

 

“Technical Services Agreement”
means the Technical Services Agreement between Cheniere LNG, Inc., Cheniere and
Contractor, dated October 14, 2003.

 

“Third Party” means any Person other
than a member of (i) the Contractor Group, (ii) the Owner Group, or (iii) any
Subcontractor or Sub-subcontractor or any employee, officer or director of such
Subcontractor or Sub-subcontractor.

 

“Third Party Proprietary Work Product”
has the meaning set forth in Section 10.1A.

 

“Unit Rates” has the meaning set
forth in Section 6.1C.

 

“USACE” means the United States Army
Corps of Engineers.

 

“U.S. Dollars” or “U.S.$” means the legal tender of the
United States of America.

 

“Warranty” or “Warranties”
has the meaning set forth in Section 12.1A.

 

“Work” means the work obligations,
duties and responsibilities to be performed by or on behalf of Contractor in
connection with the procurement, engineering, design, fabrication, erection,
installation, manufacture, inspection, repair (including Corrective Work),
testing (including Performance Tests), training, pre-commissioning,
commissioning and placing into service of the Facility and the related
component Equipment and Systems, and the required related labor and materials,
all in accordance with the terms of this Agreement and the various Attachments,
including Attachment A.

 

“Work Product” has the meaning set
forth in Section 10.1A.

 

1.2                                 The
meanings specified in this Article 1 are applicable to both the singular and
plural. As used in this Agreement, the terms “herein,” “herewith,” “hereunder”
and “hereof” are references to this Agreement taken as a whole, and the terms “include,”
“includes” and “including” mean “including, without limitation,” or variant
thereof.  Reference in this Agreement to
an Article or Section shall be a reference to an Article or Section contained
in this Agreement (and not in any Attachments or Schedules to this Agreement)
unless expressly stated otherwise, and a reference in this Agreement to an
Attachment or Schedule shall be a reference to an Attachment or Schedule
attached to this Agreement unless expressly stated otherwise.

 

Article 2

RELATIONSHIP OF OWNER, CONTRACTOR AND SUBCONTRACTORS

 

2.1                                 Status of Contractor. 
The relationship of Contractor to Owner shall be that of an independent
contractor.  Any provisions of this
Agreement which may appear to give Owner or the Owner Representative the right
to direct or control Contractor as to details of performing the

 

16

 

Work, or to
exercise any measure of control over the Work, shall be deemed to mean that
Contractor shall follow the desires of Owner or the Owner Representative in the
results of the Work only and not in the means by which the Work is to be
accomplished, and Contractor shall have the complete right, obligation and
authoritative control over the Work as to the manner, means or details as to
how to perform the Work.  Nothing herein
shall be interpreted to create a master-servant or principal-agent relationship
between Contractor, or any of its Subcontractors or Sub-subcontractors, and
Owner.  Nevertheless, Contractor shall
comply with all provisions, terms and conditions of this Agreement, and the
fact that Contractor is an independent contractor does not relieve it from its
responsibility to fully, completely, timely and safely perform the Work in
compliance with this Agreement.  Except
to the extent set forth in this Agreement, including Sections 6.1C, 6.2D, 11.5A,
11.8 and 16.3, and subject at all times to Section 6.7, Owner shall not be
entitled to issue any instruction or directive to Contractor or any of its
Subcontractors or Sub-subcontractors in connection with performance of the
Work.  Owner shall provide a copy to
Contractor of any written communication from Owner to any Subcontractor or
Sub-subcontractor that relates to Contractor’s performance of the Work.

 

2.2                                 Key Personnel, Organization Chart and Contractor Representative.

 

A.                                   Key Personnel and Organization Chart.
Attachment F sets forth Contractor’s organizational chart to be
implemented for the Work and also contains a list of key personnel (“Key Personnel” or “Key Persons”) from Contractor’s
organization who will be assigned to the Work. 
Key Personnel shall, unless otherwise expressly stated in Attachment
F, be devoted full-time to the Work until Substantial Completion, and Key
Personnel shall not be removed or reassigned without Owner’s prior written
approval (such approval not to be unreasonably withheld); provided,
however, Owner’s prior written approval shall not be required in the
event Contractor removes or reassigns a Key Person at any time prior to Owner’s
issuance of the NTP.  All requests for
the substitution of Key Personnel shall include a detailed explanation and
reason for the request and the resumes of professional education and experience
for a minimum of two (2) candidates of equal or greater qualifications and
experience.  Should Owner approve of the
replacement of a Key Person, Contractor shall, so far as reasonably
practicable, allow for an overlap of at least one (1) week during which both
the Key Person to be replaced and the Owner-approved new Key Person shall work
together full time.  The additional cost
of any replacement of such Key Personnel and overlap time shall be entirely at
Contractor’s expense.  Owner shall have
the right, but not the obligation, at any time to reasonably request that
Contractor replace any Key Person with another employee acceptable to Owner.  In
such event, Contractor shall reasonably consider Owner’s request that
Contractor replace such Key Person.

 

B.                                     Contractor Representative.  Contractor designates Asok Kumar as the
Contractor Representative.  Notification
of a change in Contractor Representative shall be provided in advance, in
writing, to Owner. The Contractor Representative is a Key Person.

 

2.3                                 Subcontractors and Sub-subcontractors.  Owner acknowledges and agrees that Contractor
intends to have portions of the Work accomplished by Subcontractors pursuant to
written Subcontracts between Contractor and such Subcontractors, and that such
Subcontractors may have certain portions of the Work performed by
Sub-subcontractors.  All Subcontracts
shall,

 

17

 

so far as
reasonably practicable, be consistent with the terms or provisions of this
Agreement.  No Subcontractor or Sub-subcontractor
is intended to be or shall be deemed a third-party beneficiary of this
Agreement.  Contractor shall be fully
responsible to Owner for the acts and omissions of Subcontractors and
Sub-subcontractors and of Persons directly or
indirectly employed by either of them in the performance of the Work, as it is
for the acts or omissions of Persons directly employed by Contractor.  The work of any Subcontractor or
Sub-subcontractor shall be subject to inspection by Owner to the same extent as
the Work of Contractor.  All
Subcontractors and Sub-subcontractors and their respective personnel on Site or
who may come on the Site or the Off-Site Rights of Way and Easements are to be
instructed by Contractor in the terms and requirements of Contractor’s safety
and environmental protection regulations and policies and shall be expected to
comply with such regulations.  In the
event that any personnel are not adhering to such regulations and policies,
such personnel shall be removed by Contractor. 
In no event shall Contractor be entitled to any adjustment of the
Contract Price or Project Schedule as a result of compliance with such
regulations and policies set forth in the HSE Plan, or any removal of personnel
necessitated by non-compliance.  Nothing
contained herein shall (i) create any contractual relationship between any
Subcontractor and Owner, or between any Sub-subcontractor and Owner, or
(ii) obligate Owner to pay or cause the payment of any amounts to
Subcontractor or Sub-subcontractor.

 

2.4                                 Subcontracts and Sub-subcontracts.

 

A.                                   Approved List.   Attachment G sets forth a list of
contractors and suppliers that Contractor and Owner have agreed are approved
for selection as Subcontractors for the performance of that portion of the Work
specified in Attachment G.  
Approval by Owner of any Subcontractors or Sub-subcontractors does not
relieve Contractor of any responsibilities under this Agreement.

 

B.                                     Additional Proposed Major Subcontractors  In the event that Contractor is considering
the selection of a Subcontractor not listed on Attachment G that would
qualify as a Major Subcontractor, Contractor shall (i) notify Owner of its
proposed Major Subcontractor as soon as reasonably practicable during the
selection process and furnish to Owner all information reasonably requested by
Owner with respect to Contractor’s selection criteria, and (ii) notify
Owner no less than ten (10) Business Days prior to the execution of a Major
Subcontract with a Major Subcontractor not listed on Attachment G.  Owner shall have the discretion, not to be
unreasonably exercised, to reject any proposed Major Subcontractor not listed
on Attachment G for a Major Subcontract. 
Contractor shall not enter into any Major Subcontract with a proposed
Major Subcontractor that is rejected by Owner in accordance with the preceding
sentence.  Owner shall undertake in good
faith to review the information provided by Contractor pursuant to this Section
2.4B expeditiously and shall notify Contractor of its decision to accept or
reject a proposed Major Subcontractor as soon as practicable after such
decision is made.  Failure of Owner to
accept or reject a proposed Major Subcontractor within ten (10) Business Days
shall be deemed to be an acceptance of such Major Subcontractor, but Owner’s
acceptance of a proposed Major Subcontractor shall in no way relieve Contractor
of its responsibility for performing the Work in compliance with this
Agreement.

 

C.                                     Other Additional Proposed Subcontractors.  For any Subcontractor not

 

18

 

covered by Section 2.4A or 2.4B and having a
Subcontract value in excess of One Million U.S. Dollars (U.S. $1,000,000),
Contractor shall, within fifteen (15) Business Days after the execution of any
such Subcontract, notify Owner in writing of the selection of such
Subcontractor and inform Owner generally what portion of the Work such
Subcontractor is performing.

 

D.                                    Delivery of Subcontracts.  Within ten (10) Days of Owner’s request,
Contractor shall furnish Owner with a copy of any Subcontract, excluding
provisions regarding pricing, discount or credit information, payment terms, payment
schedules, retention, performance security, bid or proposal data, and any other
information which Contractor or any Subcontractor reasonably considers to be
commercially sensitive information.

 

E.                                      Terms of Major Subcontracts and Sub-subcontracts.  In addition to the requirements in Section 2.3
and without in any way relieving Contractor of its full responsibility to Owner
for the acts and omissions of Subcontractors and Sub-subcontractors, each Major
Subcontract and each Major Sub-subcontract shall contain the following
provisions:

 

1.                                       the
Major Subcontract and the Major Sub-subcontract may be assigned to Owner
without the consent of the respective Major Subcontractor or Major
Sub-subcontractor; provided, however,
with respect to each Construction Equipment rental or lease agreement that
falls within the definition of Major Subcontract or Major Sub-subcontract,
Contractor shall only be obligated to use its best efforts to include a
provision that such agreement may be assigned to Owner without the consent of
the respective Construction Equipment Lessor; and

 

2.                                       so
far as reasonably practicable, the Major Subcontractor and the Major
Sub-subcontractor shall comply with all requirements and obligations of
Contractor to Owner under this Agreement, as such requirements and obligations
are applicable to the performance of the work under the respective Major
Subcontract or Major Sub-subcontract.

 

2.5                                 Contractor Acknowledgements.

 

A.                                   The Agreement.  Prior to the execution of this Agreement
under the Memorandum of Understanding and the Technical Services Agreement,
Contractor performed engineering, cost estimating and related services and
developed, provided or verified all of the information that forms the Scope of
Work and Design Basis (subject to Section 4.8) listed in Attachment A,
for the purpose of determining that such information is adequate and sufficiently
complete for Contractor to engineer, procure, construct, pre-commission,
commission, start-up and test a fully operational LNG receiving, storage and
regasification facility for the Contract Price, within the required times set
forth in the Project Schedule, and in accordance with all requirements of this
Agreement, including Applicable Codes and Standards, Applicable Law,
Warranties, Minimum Acceptance Criteria and Performance Guarantees.  Accordingly, subject to Section 4.8 and
Section 13 of Schedule A-1, Contractor (i) hereby agrees that it shall
have no right to claim or seek an

 

19

 

increase in the Contract Price or an adjustment to the
Project Schedule with respect to any incomplete, inaccurate or inadequate
information that may be contained or referenced in Attachment A, (ii)
hereby waives and releases Owner from and against any such claims, and (iii)
shall not be relieved of its responsibility to achieve all requirements under
this Agreement (including meeting Applicable Codes and Standards, Applicable
Law, Minimum Acceptance Criteria and Performance Guarantees) due to any such
incomplete, inaccurate or inadequate information.  Subject to Section 4.8, Owner makes no
guaranty or warranty, express or implied, as to the accuracy, adequacy or
completeness of any information that is contained in or referenced in Attachment
A.

 

B.                                     Conditions of the Site.

 

1.                                       Subject
to adjustment as appropriate pursuant to Section 4.3,
Contractor agrees and acknowledges that it is sufficiently familiar with the
Site and the Off-Site Rights of Way and Easements to perform the Work in
accordance with the Project Schedule, and understands the climate, terrain,
logistics, and other difficulties that it may encounter in performing the Work
in accordance with the Project Schedule. 
Except as otherwise provided in this Agreement, including Contractor’s
rights pursuant to Section 6.8A, Contractor waives any right to claim an
adjustment in the Contract Price or the Project Schedule in respect of any
failure to timely perform the Work in accordance with the Project Schedule as a
result of any of the following conditions at the Site: (i) river levels,
topography; (ii) climatic conditions, tides, and seasons; (iii) availability of
laborers, Subcontractors, Sub-subcontractors, Construction Equipment or any
other items or supplies; (iv) adequate availability and transportation of
Equipment; and (v) breakdown or other failure of Construction Equipment; provided, however, that Contractor does not assume the risk
or waive its rights with respect to those conditions in Section 2.5B.2.  This Section 2.5B.1 shall not affect the
rights of Contractor with respect to Change Orders in accordance with Section
4.3.

 

2.                                       If
Contractor encounters Subsurface Soil Conditions that
(i) are materially different from the information regarding such Subsurface
Soil Conditions as provided in the Geotechnical Reports (including the
encountering of Subsurface Soil Conditions that could not be reasonably be
anticipated by Contractor using GECP based on the information provided in the
Geotechnical Reports) and (ii) adversely affects (a) Contractor’s costs of
performance of the Work, (b) Contractor’s ability to perform the Work in
accordance with the Project Schedule or (c) Contractor’s ability to perform any
material obligation under this Agreement, Contractor shall be entitled to a
Change Order; provided that Contractor complies
with the requirements set forth in Sections 6.2, 6.5 and 6.9.

 

C.                                     Applicable Law and Applicable Codes and Standards.  Contractor has investigated to its satisfaction
Applicable Law and Applicable Codes and Standards in existence as of the
Contract Date, and warrants that it can perform the Work at the Contract Price
and within the Project Schedule in accordance with such Applicable Law and
Applicable Codes and Standards. 
Contractor shall perform the Work in accordance with Applicable Law
(including Applicable Codes and Standards), whether or not such

 

20

 

Applicable Law or Applicable Codes and Standards came
into effect before the Contract Date or during the performance of the Work; provided, however, Contractor shall be entitled to a Change
Order for any Change in Law to the extent allowed under Section 6.2A.1.  Contractor shall advise Owner of any change
in Applicable Codes and Standards which does not constitute a Change in Law
and, upon such advisement, Owner may elect, at its sole option, to implement a
change in accordance with Section 6.1D.

 

Article 3

CONTRACTOR’S RESPONSIBILITIES

 

3.1                                 Scope of Work.

 

A.                                   Generally.  Subject to Section 3.1B, the Work shall be
performed on a turnkey basis and shall include all of the Work required to
achieve RFCD, Substantial Completion and Final Completion in accordance with
the requirements of this Agreement, including achieving the Minimum Acceptance
Criteria and Performance Guarantees. 
Contractor shall be required to integrate and use Owner’s operations
personnel in its pre-commissioning commissioning, testing, start-up efforts,
subject to Owner’s obligations under Section 4.4.  Contractor shall perform the Work in
accordance with GECP, Applicable Law, Applicable Codes and Standards, and all
other terms and provisions of this Agreement, with the explicit understanding
that the Facility will operate as a LNG receiving, storage and regasification
facility meeting all requirements and specifications of this Agreement.  It is understood and agreed that the Work
shall include any incidental work that can reasonably be inferred as necessary
to complete the Facility in accordance with GECP, Applicable Law, Applicable
Codes and Standards, and all other terms and provisions of this Agreement,
excluding only those items which Owner has specifically agreed to provide under
the terms of this Agreement.  Without
limiting the generality of the foregoing, the Work is more specifically
described in Attachment A.

 

B.                                     Exception to Scope of Work.  Contractor shall not be responsible for
providing (i) the Owner Permits; (ii) LNG; (iii) those requirements set forth
under Sections 4.3, 4.4 and 4.8; (iv) legal description of the Site and a
survey of the Site showing the boundaries of the Site and one survey control
point pursuant to Section 4.6; and (v) any other obligations or requirements
set forth in this Agreement as required to be performed by Owner.

 

3.2                                 Specific Obligations. 
Without limiting the generality of Section 3.1 or the requirements of
any other provision of this Agreement, Contractor shall:

 

A.                                   procure,
supply, transport, handle, properly store, assemble, erect and install all
Equipment;

 

B.                                     provide
construction, construction management (including the furnishing of all
Construction Equipment used in the field, and all Site supervision and craft
labor), inspection and quality control services required to ensure that the
Work is performed in accordance herewith;

 

C.                                     negotiate
all guarantees, warranties, delivery schedules and performance

 

21

 

requirements with all Subcontractors so that all
Subcontracts are, so far as reasonably practicable, consistent with this
Agreement, as set forth in Sections 2.3 and 2.4;

 

D.                                    perform
shop and other inspections of the work of Subcontractors and Sub-subcontractors
as required by Contractor to ensure that such work meets all of the
requirements of this Agreement;

 

E.                                      ensure
that the Work is performed in accordance with the Project Schedule;

 

F.                                      until
Substantial Completion, conduct and manage all pre-commissioning, start-up,
operations, commissioning, Performance Testing of the Facility, while
supervising and directing operating personnel provided by Owner;

 

G.                                     obtain
all Contractor Permits;

 

H.                                    provide
assistance, information and documentation as reasonably requested by Owner to
enable Owner to obtain the Owner Permits; provided that such
assistance, information and documentation shall not include Contractor’s
provision of information, testimony, documents or data by Contractor’s
employees under oath (unless specifically authorized by Contractor) and
activities outside the field of Contractor’s expertise, training or experience
of personnel assigned to the performance of the Work under this Agreement
(expect to the extent provided for by Change Order issued pursuant to Section 6.1
and agreed by Contractor);

 

I.                                         provide
training for Owner’s operating and maintenance personnel per Section 3.5;

 

J.                                        cooperate
with and respond promptly to reasonable inquiries from Owner; provided that such cooperation shall not include Contractor’s
provision of information, testimony, documents or data by Contractor’s
employees under oath (unless specifically authorized by Contractor) and
activities outside the field of Contractor’s expertise, training or experience
of personnel assigned to the performance of the Work under this Agreement
(expect to the extent provided for by Change Order issued pursuant to Section 6.1
and agreed by Contractor);

 

K.                                    be
responsible for connecting the Facility to the permanent utilities to the
extent set forth in Attachment A;

 

L.                                      supply
all initial fills, excluding LNG and Natural Gas; and

 

M.                                 perform
all design and engineering Work in accordance with this Agreement, including
that specified in Section 3.3.

 

3.3                                 Design and Engineering Work.

 

A.                                   General.  Contractor shall, as part of the Work,
perform all design and engineering Work in accordance with this Agreement and
cause the Work to meet and achieve the requirements of this Agreement,
including achieving the Minimum

 

22

 

Acceptance Criteria and Performance Guarantees.

 

B.                                     Drawings and Specifications.  Upon receipt of the Limited Notice to Proceed
or Notice to Proceed issued in accordance with Sections 5.1 and 5.2, Contractor
shall commence the preparation of the Drawings and Specifications for all Work
relating to such LNTP or NTP.  The
Drawings and Specifications shall be based on the requirements of this
Agreement, including the Scope of Work, Design Basis, GECP, Applicable Codes
and Standards and Applicable Law.

 

C.                                     Review Process.

 

1.                                       Submission by Contractor. 
Contractor shall submit copies of the Drawings and Specifications
specified in Attachment B to Owner for formal review, comment or
disapproval in accordance with Attachment B.

 

2.                                       Review Periods.  Owner
shall have up to ten (10) Business Days from its receipt of Drawings and
Specifications submitted in accordance with Section 3.3C.1 to issue to
Contractor written comments, proposed changes and/or written disapprovals of
the submission of such Drawings and Specifications to Contractor.

 

If Owner does not issue
any comments, proposed changes or written disapprovals within such time
periods, Contractor may proceed with the development of such Drawings and
Specifications and any construction relating thereto, but Owner’s lack of
comments or disapproval, if applicable, shall in no event constitute an
approval of the matters received by Owner.

 

In the event that Owner
disapproves the Drawings or Specifications (which disapproval shall not be
unreasonably issued), Owner shall provide Contractor with a written statement
of the reasons for such rejection within the time period required for Owner’s
response, and Contractor shall provide Owner with revised and corrected
Drawings and Specifications as soon as possible thereafter.  In the event Owner unreasonably disapproves
such Drawings and Specifications and such unreasonable disapproval adversely
impacts Contractor’s costs or ability to perform the Work in accordance with
the Project Schedule, Contractor shall be entitled to a Change Order provided that Contractor complies with the requirements set
forth in Sections 6.2, 6.5 and 6.9.

 

Provided that Owner has
not disapproved of the Drawings and Specifications, such Drawings and
Specifications shall be the Drawings and Specifications that Contractor shall
use to construct the Work; provided that
Owner’s lack of disapproval of or comments on, or any approval by Owner of, any
Drawings and Specifications shall not in any way be deemed to limit or in any
way alter Contractor’s responsibility to perform and complete the Work in
accordance with the requirements of this Agreement.

 

D.                                    Design Licenses.  Contractor shall perform all design and
engineering Work in accordance with Applicable Law, and all Drawings and
Specifications shall be signed and stamped by design professionals licensed in
accordance with Applicable Law.

 

23

 

E.                                      CAD Drawings.  Those Drawings and Record Drawings specified
in Attachment A and Attachment B and prepared by Contractor or
its Subcontractors or Sub-subcontractors under this Agreement shall be prepared
using computer aided design (“CAD”).  Contractor shall provide Drawings, including
Record Drawings, in their native formats as set forth in Attachment B along
with six (6) hard copies.

 

F.                                      Progress P&ID’s.  During the Project, Contractor shall maintain
and provide Owner with access to a marked, up-to-date set of P&ID’s
maintained for and by Contractor.

 

G.                                     Record Drawings and Specifications.  As a condition precedent to Final Completion,
Contractor shall deliver to Owner the Record Drawings and Specifications in
accordance with Attachment A and Attachment B.

 

H.                                    Other Information.  Contractor shall deliver copies of all other
documents required to be delivered pursuant to Attachment B within and
in accordance with the requirements and timing set forth in Attachment B.

 

3.4                                 Spare Parts.  Not
later than one hundred and eighty (180) Days prior to the Guaranteed
Substantial Completion Date, Contractor shall deliver to Owner a detailed list
of all manufacturer and Contractor-recommended spare parts and special tools necessary
for operating and maintaining all Equipment (including components and systems
of such Equipment) for two (2) years following Substantial Completion (“Operating Spare Parts”).  Within thirty (30) Days thereafter, Owner
shall specify in writing which items on the list it wishes Contractor to
purchase and whether such items are requested to be delivered to the Site prior
to Substantial Completion or prior to Final Completion. Within a further thirty
(30) Days, Contractor shall confirm the extent to which it is able to comply
with Owner’s request and shall submit to Owner the final list of Operating
Spare Parts to be purchased (“Operating Spare Parts List”).  Prior to and as a condition precedent to
Substantial Completion, Contractor shall deliver to the Site all Operating
Spare Parts required to be delivered to the Site prior to Substantial
Completion as set forth in the Operating Spare Parts List. Prior to and as a
condition to achieving Final Completion, Contractor shall deliver to the Site
all Operating Spare Parts required to be delivered to the Site prior to Final
Completion as set forth in the Operating Spare Parts List.  The Operating Spare Parts List shall include
all information specified in Attachment W.  An allowance for the cost of Operating Spare
Parts is included in the Contract Price as set forth in Section 7.1C.

 

3.5                                 Training Program in General. 
As part of the Work, a reasonable number of personnel designated by
Owner in its sole discretion (but not to exceed the number of Persons listed in
Attachment V) shall be given a training course designed and administered
by Contractor, which shall be based on the outline of the program contained in Attachment
V and shall cover at a minimum the following topics: (i) the testing of
each item of Equipment; (ii) the start-up, operation and shut-down of each item
of Equipment; (iii) the performance of routine, preventative and emergency
maintenance for each item of Equipment; and (iv) spare parts to be maintained
for each item of Equipment, and their installation and removal. Training shall
be provided by personnel selected by Contractor who, in Contractor’s and the
Equipment Subcontractor’s or Sub-subcontractor’s judgment, are qualified to
provide such training, and shall take place at such locations and at such times
as agreed upon by the Parties. 
Contractor shall provide trainees with

 

24

 

materials
described in Attachment V. 
Contractor shall also provide to Owner all training materials and aids
developed to conduct such training in order to facilitate future training by
Owner of additional personnel.

 

3.6                                 Environmental Regulations and Environmental Compliance.  Without limitation of Section 3.1, Contractor
shall perform the Work and shall design, construct,  pre-commission, commission, start-up and test
the Facility in compliance with Contractor’s HSE Plan.  Contractor shall dispose of all non-hazardous
wastes and Hazardous Materials brought onto the Site or Off-Site Rights of Way
and Easements by Contractor or any of its Subcontractors or Sub-subcontractors
or generated during performance of the Work, all of which shall be disposed in
off-Site locations permitted to receive such non-hazardous wastes and Hazardous
Materials.  Contractor shall deliver to
Owner (i) notice of any pending or threatened material environmental
claim with respect to the Project, and (ii) promptly upon their becoming
available, copies of written communications with any Governmental
Instrumentality relating to any such material environmental claim.

 

3.7                                 Construction Equipment. 
Contractor shall furnish all Construction Equipment necessary and
appropriate for the timely and safe completion of the Work in compliance with
this Agreement.  Notwithstanding anything
to the contrary contained in this Agreement, Contractor shall be responsible
for damage to or destruction or loss of, from any cause whatsoever, all such
Construction Equipment.  Contractor shall
require all insurance policies (including policies of Contractor and all
Subcontractors and Sub-subcontractors) in any way relating to such Construction
Equipment to include clauses stating that each underwriter will waive all
rights of recovery, under subrogation or otherwise, against Owner, Lender and
any Owner Affiliates.

 

3.8                                 Employment of Personnel.

 

A.                                   Contractor
shall not employ, or permit any Subcontractor or Sub-subcontractor to employ,
at the Site, in connection with its performance under this Agreement, any
Person who is demonstrably not skilled or qualified in the work assigned to
such Person.  Contractor agrees to
promptly remove (or to require any Subcontractor to remove) from its services
in connection with the Work any Person who does not meet the foregoing
requirements.  In addition, Contractor
agrees that, after receipt of written notice from Owner, it shall promptly
remove from the Work any employee or agent of Contractor or of Contractor’s
Subcontractors or Sub-subcontractors who, in Owner’s reasonable opinion, is
unsafe, incompetent, careless, unqualified to perform the Work assigned to such
Person, creates an unsafe work environment, disregards the terms and conditions
of this Agreement, or is interrupting, interfering with or impeding the timely
and proper completion of the Work.  NOTWITHSTANDING THE FOREGOING, OWNER SHALL
HAVE NO LIABILITY AND CONTRACTOR AGREES TO RELEASE, INDEMNIFY, DEFEND AND HOLD
HARMLESS THE OWNER GROUP FROM AND AGAINST ANY AND ALL CLAIMS, CAUSES OF ACTION,
DAMAGES, LOSSES, COST AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES AND
LITIGATION OR ARBITRATION EXPENSES) AND LIABILITIES, OF WHATSOEVER KIND OR
NATURE, WHICH MAY DIRECTLY OR INDIRECTLY ARISE OR RESULT FROM CONTRACTOR OR ANY
SUBCONTRACTOR OR SUB-SUBCONTRACTOR CHOOSING TO TERMINATE THE EMPLOYMENT OF ANY
SUCH EMPLOYEE (INCLUDING ANY KEY PERSON) OR REMOVE SUCH EMPLOYEE FROM THE
PROJECT WHO FAILS TO MEET THE FOREGOING

 

25

 

REQUIREMENTS FOLLOWING A
REQUEST BY OWNER TO HAVE SUCH EMPLOYEE REMOVED FROM THE WORK.  ANY
SUCH EMPLOYEE SHALL BE REPLACED AT THE COST AND EXPENSE OF CONTRACTOR OR THE
RELEVANT SUBCONTRACTOR, AS APPROPRIATE; PROVIDED, HOWEVER, THAT
SHOULD (I) CONTRACTOR DISAGREE WITH OWNER’S IDENTIFICATION OF AN INDIVIDUAL FOR
REMOVAL FROM THE PERFORMANCE OF SERVICES UNDER THIS SECTION 3.8A, (II) OWNER
NOT RETRACT ITS REQUEST FOR REMOVAL UPON BEING ADVISED OF SUCH DISAGREEMENT,
AND (III) SUCH INDIVIDUAL DOES NOT IN FACT CONFORM TO THE FOREGOING CRITERIA
FOR REMOVAL, CONTRACTOR SHALL BE ENTITLED TO A RECIPROCAL INDEMNITY FROM OWNER IN
RESPECT TO ANY CLAIMS, CAUSES OF ACTION, DAMAGES, LOSSES, COST AND EXPENSES
(INCLUDING ALL REASONABLE ATTORNEYS’ FEES AND LITIGATION OR ARBITRATION
EXPENSES) AND LIABILITIES OF WHATEVER KIND OR NATURE, WHICH MAY DIRECTLY OR
INDIRECTLY ARISE FROM CONTRACTOR’S REMOVAL OF ANY SUCH EMPLOYEE (INCLUDING ANY
KEY PERSON) FROM THE PROJECT.

 

B.                                     Contractor
is responsible for maintaining labor relations in such manner that, so far as
reasonably practicable, there is harmony among workers.  Contractor and its Subcontractors and
Sub-subcontractors shall conduct their labor relations in accordance with the
recognized prevailing local area practices. Contractor shall inform Owner
promptly of any labor dispute, anticipated labor dispute, request or demand by
a labor organization, its representatives or members which may reasonably be
expected to affect the Work. Contractor further agrees to inform Owner, before
any commitments are made, during the negotiations of any agreements or
understandings with local or national labor organizations.

 

3.9                                 Clean-Up.  Contractor
shall, to Owner’s reasonable satisfaction, at all reasonable times keep the
Site free from all waste materials or rubbish caused by the activities of
Contractor or any of its Subcontractors or Sub-subcontractors.  As soon as practicable after the completion
of all Punchlist items, Contractor shall remove, at its own cost, all of its
Construction Equipment and remove from the Site all waste material and rubbish
that was generated or brought on to the Site by Contractor or any of its
Subcontractors or Sub-subcontractors. 
The Site shall be restored to the extent, if any, required by Attachment
A.  In the event of Contractor’s
failure to comply with any of the foregoing, Owner may accomplish the same; provided, however, that Contractor shall be responsible for
all reasonable costs associated with such
removal and/or restoration, including costs associated with permitting and
transportation.

 

3.10                           HSE Plan; Security.

 

A.                                   Contractor
recognizes and agrees that safety and physical security are of paramount
importance in the performance of the Work and that Contractor is responsible
for performing the Work in a safe and physically secure manner.  No later than sixty (60) Days after Owner’s
issuance of the LNTP, Contractor shall submit to Owner for its review a health,
safety and environmental plan (including a drug testing program) meeting the
requirements set forth in Attachment J (the “HSE
Plan”).  Contractor
further agrees to perform the Work in accordance with the health, safety and
environmental rules and standards of Applicable Law, GECP and the HSE Plan
(collectively, the “Safety Standards”), and
Contractor shall assume all costs associated with compliance therewith.  Owner’s review of the HSE Plan shall not in
any way relieve Contractor of its obligations

 

26

 

under this Agreement (including Contractor’s
obligations to conduct the Work in accordance with the health, safety and
environmental rules of Applicable Law and GECP).  Contractor shall appoint one or more (as
appropriate) safety representative(s) reasonably acceptable to Owner who shall
be resident at the Site, have responsibility to correct unsafe conditions or
unsafe acts associated with the Work and the Facility, act on behalf of
Contractor on health, safety and environmental matters, and participate in
periodic safety meetings with Owner. Contractor further agrees to provide or
cause to be provided necessary training and safety equipment to its employees,
Subcontractors and Sub-subcontractors and to Owner personnel temporarily
visiting the Site to ensure their compliance with the foregoing Safety
Standards and enforce the use of such training and safety equipment.  Contractor shall maintain all accident,
injury and any other records required by Applicable Law or by Permit and shall
furnish Owner a Monthly summary of injuries and labor hours lost due to
injuries.  Should Owner at any time
observe Contractor, or any of its Subcontractors or Sub-subcontractors,
performing the Work at the Site in violation of the Safety Standards or in an
unsafe manner, or in a manner that would, if continued, violate the Safety
Standards or become unsafe, then Owner shall have the right (but not the
obligation) to require Contractor to stop the affected Work until such time as
the manner of performing such Work has been rendered safe; provided,
however, that at no time shall Contractor be entitled to an
adjustment of the Contract Price or Project Schedule based on such Work
stoppage.  Contractor shall be
responsible for the security, fencing, guarding, lighting, and supervision of
the Facility until all of the requirements of Substantial Completion have been
satisfied.

 

B.                                     All
Work performed hereunder, as applicable, shall comply with the minimum federal
safety standards for the design, installation, inspection, testing, construction,
extension, operation, replacement, and maintenance of facilities contained in
Title 49, Code of Federal Regulations, Parts 192 (to the extent applicable) and
193 and in Title 33 C.F.R. Part 127. Contractor shall comply with requirements
of the Operator Qualification Program that are outlined in Sub-Part H of 49
C.F.R. Part 193 and Sub-Part G of C.F.R. Part 195, where applicable, in
connection with the Work.  The term “pipeline
facilities” shall include new and existing pipe, rights-of-way, and any equipment,
facility, or building used in the transportation of gas, including LNG, or
treatment of gas during the course of transportation.  The term “transportation of gas” shall
include the gathering, transmission, or distribution of gas by pipeline or the
storage of gas.

 

3.11                           Emergencies.  In the
event of any emergency endangering life or property in any way relating to the
Work, whether on the Site or otherwise, Contractor shall take such action as
may be reasonable and necessary to prevent, avoid or mitigate injury, damage,
or loss and shall, as soon as reasonably possible, report any such incidents,
including Contractor’s response thereto, to Owner.  If Contractor fails to take such action and
the emergency requires immediate action, then Owner, with or without notice to
Contractor may, but shall be under no obligation to, take reasonable action as
required to address such emergency.  The
taking of any such action by Owner, or Owner’s failure to take any action,
shall not limit Contractor’s liability.  Contractor shall reimburse Owner in an amount
equal to the reasonable costs incurred by Owner in taking such action.

 

3.12                           Contractor Permits. 
Contractor shall be responsible for obtaining the Contractor

 

27

 

Permits.  Contractor shall provide Owner with copies of
such Contractor Permits as soon as reasonably practicable after they are
obtained.  Contractor shall provide
information, assistance and documentation to Owner as reasonably requested in
connection with the Owner Permits; provided that such
information, assistance and documentation shall not include Contractor’s
provision of information, testimony, documents or data by Contractor’s
employees under oath (unless specifically authorized by Contractor) and
activities outside the field of Contractor’s expertise, training or experience
of personnel assigned to the performance of the Work under this Agreement
(expect to the extent provided for by Change Order issued pursuant to Section 6.1
and agreed by Contractor).

 

3.13                           Books, Records and Audits.

 

A.                                   Contractor
shall keep full and detailed books, construction logs, records, daily reports,
schedules, accounts, payroll records, receipts, statements, electronic files,
correspondence and other pertinent documents as may be necessary for proper
management under this Agreement, as required under Applicable Law or this
Agreement, and in any way relating to this Agreement (“Books
and Records”).  Contractor
shall maintain all such Books and Records in accordance with GAAP and shall
retain all such Books and Records for a minimum period of three (3) years after
Final Completion, or such greater period of time as may be required under
Applicable Law.

 

B.                                     Upon
reasonable notice, Owner shall have the right to have audited Contractor’s
Books and Records by Owner’s third party auditors but only to the extent
necessary to validate payments made to Contractor or invoiced by Contractor on
the basis of Reimbursable Costs and as permitted under Section 4.5.  When requested by Owner, Contractor shall
provide Owner’s auditors with reasonable access to all such relevant Books and
Records, and Contractor’s personnel shall cooperate with such auditors to
effectuate the audit or audits hereunder. 
Owner shall have the right upon consent of Contractor (such consent not
to be unreasonably withheld or delayed) to have the auditors copy all such
Books and Records.  Contractor shall bear
all costs incurred by it in assisting with audits performed pursuant to this
Section 3.13. Contractor shall include audit provisions identical to this
Section 3.13 in all Major Subcontracts. 
No access to Books and Records shall be granted to Owner’s auditors
until such auditors have signed a confidentiality agreement with Contractor in
accordance with the standard practice in the auditing industry for audits of
this kind.

 

C.                                     Contractor
shall not, and shall provide that its Subcontractors, Sub-subcontractors and
agents or employees of any of them shall not, without Owner’s prior written
approval, (i) pay any commissions or fees, or grant any rebates, to any
employee or officer of Owner or its Affiliates, (ii) favor employees or
officers of same with gifts or entertainment of a significant cost or value, or
(iii) enter into any business arrangements with employees or officers of same.

 

3.14                           Tax Accounting. 
Within a reasonable period of time following a request therefor by
Owner, subject to Section 4.5C, Contractor shall provide Owner’s third party auditors
with any information (including Books and Records) regarding quantities and
descriptions of any Equipment installed on or ordered for the Facility and any
other information as Owner’s third party 

 

28

 

auditors may deem
reasonably necessary in connection with the preparation of Owner’s tax returns
(including information reasonably required to determine the amount of Qualified
Research Expenditures incurred in connection with the Work) or other tax
documentation in connection with the Project; provided,
however, if, in connection with such preparation, Owner’s third
party auditors request information relating to the actual cost for any item of
Work and such item of Work is included in the Contract Price or in any lump sum
Change Order, Contractor shall provide such information to Owner’s third party
auditors as provided in Section 4.5C.  No
access to the aforementioned information (including Books and Records) shall be
granted to Owner’s auditors until such auditors have signed a confidentiality
agreement with Contractor in accordance with the standard practice in the
auditing industry for audits of this kind.

 

3.15                           Temporary Utilities, Roads, Facilities and Storage.  Until Substantial Completion, Contractor
shall provide and pay for all temporary utilities (i.e.,
electricity, water (other than the water provided by Owner for the hydrotest in
accordance with Attachment U), communication, cable, telephone, waste
and sewer) necessary for the performance of the Work, including installation
and usage costs.  Subject to Section 4.3,
Contractor shall construct and maintain temporary access and haul roads as may
be necessary for the proper performance of this Agreement.  Contractor shall provide Owner with
sufficient office space at the time of Contractor’s mobilization at the Site to
accommodate Owner’s Site representative and support staff at the Site.  Contractor shall provide Owner with all
office space, construction trailers, utilities, storage and warehousing,
security, telephones, furnishings, and other temporary facilities required for
their oversight of the Work, as set forth in more detail in Attachment A,
Schedule A-1.  Once title to
Equipment has passed to Owner as set forth in Section 8.1B, such Equipment
shall, if stored at a location other than on the Site, be segregated from other
goods, and shall be clearly marked as “Property of Sabine Pass LNG, L.P.”

 

3.16                           Subordination of Liens. 
Contractor hereby subordinates any mechanics’ and materialmen’s liens or
other claims or encumbrances that may be brought by Contractor against any or
all of the Work, the Site or the Facility to any liens granted in favor of
Lender, whether such lien in favor of Lender is created, attached or perfected
prior to or after any such liens, claims or encumbrances, and shall require its
Subcontractors and Sub-subcontractors to similarly subordinate their lien,
claim and encumbrance rights.  Contractor
agrees to comply with reasonable requests of Owner for supporting documentation
required by Lender in connection with such subordination, including any
necessary lien subordination agreements. 
Nothing in this Section 3.16 shall be construed as a limitation on or
waiver by Contractor of any of its rights under Applicable Law to file a lien
or claim or otherwise encumber the Facility as security for any undisputed
payments owed to it by Owner hereunder which are past due; provided
that such lien, claim or encumbrance shall be subordinate to any
liens granted in favor of Lenders.

 

3.17                           Hazardous Materials. 
Contractor shall not, nor shall it permit or allow any Subcontractor or
Sub-subcontractor to, bring any Hazardous Materials on the Site and shall bear
all responsibility and liability for such materials; provided,
however, that Contractor may bring onto the Site such Hazardous
Materials as are necessary to perform the Work so long as the same is done in
compliance with Applicable Law, Applicable Codes and Standards, and the HSE
Plan, and Contractor shall remain responsible and liable for all such Hazardous
Materials.  If Contractor or any Subcontractor
or Sub-subcontractor encounter pre-existing Hazardous Materials at the Site,
and Contractor or any Subcontractor or Sub-subcontractor knows or suspects that
such material is

 

29

 

Hazardous
Material, Contractor and its Subcontractors and Sub-subcontractors shall
promptly stop Work in the affected area and notify Owner.  If under such circumstances Contractor or any
of its Subcontractors or Sub-subcontractors fail to stop Work and notify Owner,
Contractor shall be responsible and liable to Owner for all damages, costs,
losses and expenses to the extent attributable to such failure.

 

3.18                           Quality Assurance.  On
or before the date Owner issues the NTP, Contractor shall submit to Owner for
its review an outline of a Facility-specific quality assurance plan and an inspection
plan.  No later than sixty (60) Days
after the date Owner issues the NTP, Contractor shall submit to Owner for its
written approval (which shall not be unreasonably withheld), a Facility-specific
quality assurance plan and an inspection plan, including witness points, but
excluding tests and inspections relating to commissioning.  No later than one hundred twenty (120) Days
after the date Owner issues the NTP, Contractor shall submit to Owner for its
written approval (which shall not be unreasonably withheld), detailed
inspection procedures.  Contractor’s
quality assurance plan shall provide for a quality assurance individual to be
present at the Site to supervise the implementation of the quality assurance
plan, the inspection plan, and the inspection procedures.  Owner’s review and approval of Contractor’s
quality assurance plan, inspection plan and inspection procedure shall in no
way relieve Contractor of its responsibility for performing the Work in
compliance with this Agreement.

 

3.19                           Reports.

 

A.                                   Contractor
shall provide Owner with an electronic copy of the
following reports and other documentation:

 

1.                                       minutes
for all weekly status and other Project-related meetings with Owner within five
(5) Business Days following such meeting;

 

2.                                       safety
incident reports within three (3) Business Days of the occurrence of any such
incident; except for any safety incident involving a significant non-scheduled
event such as LNG or Natural Gas releases, fires, explosions, mechanical
failures, unusual over-pressurizations or major injuries which shall be provided to Owner within eight
(8) hours of the occurrence of such incident; provided,
however, notification shall be provided to Owner immediately if the
incident is of significant magnitude to threaten public or employee safety,
cause significant property damage or interrupt the Work;

 

3.                                       Monthly
progress reports (“Monthly Progress Reports”)
with the information specified in Attachment A.

 

3.20                           Payment.  Contractor
shall timely make all payments required to be paid to Owner pursuant to the
terms of this Agreement.

 

3.21                           Commercial Activities. 
Neither Contractor nor its employees shall establish any commercial
activity or issue concessions or permits of any kind to Third Parties for
establishing commercial activities on the Site or any other lands owned or
controlled by Owner.

 

3.22                           Title to Materials Found. 
As between Owner and Contractor, the title to water,

 

30

 

soil, rock,
gravel, sand, minerals, timber, dredge material, and any other materials
developed or obtained in the excavation or other operations of Contractor, any Subcontractor or Sub-subcontractor and the right to use said materials
or dispose of same is hereby expressly reserved by Owner.  Notwithstanding the
foregoing, Contractor shall be permitted, without charge, to use in the
Work any such materials that comply with the requirements of this Agreement.
Material dredged in the performance of the Work shall be deposited in the areas
designated by Owner as set forth in Attachment Y.

 

3.23                           Survey Control Points and Layout.  Contractor shall establish all survey control
points and layout the entire Work in accordance with the requirements of this
Agreement, which shall be based on the survey control point established by
Owner pursuant to this Agreement.  If
Contractor or any of its Subcontractors, Sub-subcontractors or any of the
representatives or employees of any of them move or destroy or render
inaccurate the survey control point provided by Owner, such control point shall
be replaced by Contractor at Contractor’s own expense.

 

3.24                           Cooperation with Others.

 

A.                                   Cooperation on the Site.  Subject to the provisions of this Agreement,
including Section 4.3, Contractor acknowledges that Owner or Owner’s other
contractors or subcontractors may be working at the Site during the performance
of this Agreement and Contractor’s Work or use of certain facilities may be
interfered with as a result of such concurrent activities. Owner shall provide
Contractor with reasonable notice of any request for access to the Site by (i) any
of Owner’s other contractors or subcontractors seeking to perform work at the
Site or (ii) any Landowner.  Subject to
Section 4.3, Contractor agrees to use reasonable efforts to accommodate such
request and to coordinate the performance of the Work with such other
contractors or subcontractors performing work at the Site so as not to
materially interfere with any of Owner’s other contractors or subcontractors
performing work at the Site.

 

B.                                     Cooperation Within the Off-Site Rights of Way and
Easements.  Owner shall
provide Contractor with reasonable prior notice of access to the Off-Site
Rights of Way and Easements by (i) any of Owner’s other contractors or
subcontractors seeking to perform work within such Off-Site Rights of Way and
Easements (ii) any Landowner.  Likewise,
Contractor shall provide Owner with reasonable prior notice of any access to
the Off-Site Rights of Way and Easements by Contractor or any of its
Subcontractors or Sub-subcontractors. 
Subject to the provisions of this Agreement, including Section 4.3,
Contractor acknowledges that Owner or Owner’s other contractors or
subcontractors may be working within the Off-Site Rights of Way and Easements
and that other Persons (including any Landowner) may be on or using the
Off-Site Rights of Way and Easements during the performance of this Agreement
and Contractor’s Work or use of certain facilities may be interfered with as a
result of such concurrent activities. Subject
to Section 4.3, Contractor
agrees to use reasonable efforts to accommodate such request and to
coordinate the performance of the Work with such other contractors or subcontractors performing work within
the Off-Site Rights of Way and Easements so as not to materially interfere with
any of Owner’s other contractors or subcontractors performing work within the
Off-Site Rights of Way and Easements; provided, however, Contractor shall in all cases coordinate the
Work with any Persons (other than Owner or Owner’s other contractors or

 

31

 

subcontractors) on or using
the Off-Site Rights of Way and Easements, and Contractor shall adhere to the reasonable
instructions provided by Owner or the applicable Landowner(s) in connection
with Work performed within such Off-Site Rights of Way and Easements.

 

3.25                           Responsibility for Property. 
Contractor shall plan and conduct its operations so that neither
Contractor nor any of its Subcontractors or Sub-subcontractors shall (i) enter upon
lands (other than the Site and Off-Site Rights of Way and Easements) or
waterbodies in their natural state unless authorized by the appropriate owner
or entity; (ii) close or obstruct any utility installation, highway, waterway,
harbor, road or other property unless Permits are obtained and authorized by
the appropriate entity or authority; or (iii) disrupt or otherwise interfere
with the operation of any portion of any pipeline, telephone, conduit or electric
transmission line, ditch, navigational aid, dock or structure unless otherwise
specifically authorized by the appropriate entity or authority.  The foregoing includes damage arising from
performance of the Work through operation of Construction Equipment or
stockpiling of materials.

 

3.26                           Explosives. 
Explosives shall be transported to the Site only when required to
perform the Work under this Agreement and with abundant, prior notice to and
written approval of Owner. Contractor shall be responsible for properly
purchasing, transporting, storing, safeguarding, handling and using explosives
required to perform the Work under this Agreement. Contractor shall employ
competent and qualified personnel for the use of explosives and,
notwithstanding any other provision in this Agreement to the contrary, shall
assume full responsibility for damages claimed by any Third Party to the extent
caused by the improper use of explosives by Contractor or any Subcontractor or
Sub-subcontractor. Residual surplus explosives shall be promptly removed from
the Site and properly disposed of by Contractor.

 

3.27                           Taxes.  Subject to
Sections 4.5 and 7.1A, the Contract Price includes all Taxes payable by
Contractor, its Subcontractors and Sub-subcontractors in connection with the
Work.  Subject to Section 4.5, as between
Owner and Contractor, Contractor shall be responsible for the payment of all
Taxes payable by Contractor, its Subcontractors and Sub-subcontractors in
connection with the Work.

 

3.28                           Equipment Quality. 
Contractor shall furnish reasonable evidence as to the kind, quality,
and quantity of all Major Equipment. 
Without prior written approval by Owner which specifically waives the
requirements of this Agreement, where this Agreement specifies certain Major
Equipment be incorporated into the Facility, Contractor shall not use any Major
Equipment other than as specified in this Agreement.  If Contractor wishes to modify the
requirements contained herein, then it shall make written application to Owner
for Owner’s approval (such approval not to be unreasonably withheld), prior to
performing any such Work.  Such
application shall (i) identify the requirements being modified, (ii) certify
that the quality of the proposed substitute is equal to or better than that
currently specified, and (iii) certify that the substitute is suited to the
same use and capable of performing the same function as that specified.  If the preceding requirements are not
followed, then any substitution shall constitute a material failure by Contractor
to comply with its obligations under this Agreement.  All Major Equipment shall be fabricated,
applied, installed, connected, operated (during start-up and testing), cleaned
and conditioned in accordance with the instructions of the applicable Subcontractor
or Sub-subcontractor.

 

32

 

Article 4

OWNER’S RESPONSIBILITIES

 

Owner shall comply with
the following provisions in a timely manner in accordance with the Project
Schedule at no cost to Contractor:

 

4.1                                 Payment
and Financing.  Owner shall timely
pay the Contract Price in accordance with the provisions of Article 7
hereof.  As a condition of NTP, Owner
shall obtain and maintain financing for the Project sufficient to make payments
to Contractor in accordance with the terms of this Agreement.

 

A.                                   Owner Monthly Confirmation.
Beginning with Owner’s issuance of the NTP and continuing monthly thereafter
until the first draw is made under the financing (the “First
Draw”), Owner shall deliver to Contractor a statement in the
form of Schedule BB-2 (“Owner Monthly Confirmation”)
confirming that Owner has sufficient funds to continue to
fulfill its payment obligations up to the date of the First Draw and confirming
that no event has come to the attention of Owner which would materially and
adversely affect the continued availability of such funding.  Each Owner Confirmation shall be signed by an
appropriate senior officer of Owner.

 

B.                                     Owner Quarterly Confirmation.  After the First Draw, and continuing
quarterly thereafter, Owner shall deliver to Contractor a statement in the form
of Schedule BB-3 (“Owner Quarterly
Confirmation”) confirming that Owner has sufficient funds
through itself or financing to continue to fulfill its payment obligations
under this Agreement and confirming that no event has come to the attention of
Owner which would materially and adversely affect the continued availability of
such funding. Such Owner Quarterly Confirmation shall be signed by an
appropriate senior officer of Owner.

 

4.2                                 Owner Permits.  Owner
shall be responsible for obtaining the Owner Permits.  Owner shall maintain and, to the extent
applicable, renew such Owner Permits.  To
the extent Owner has already obtained any of the Owner Permits as of the
Effective Date of this Agreement, Owner shall provide copies of such Owner
Permits to Contractor on or before the Effective Date.  To the extent Owner has not obtained any
Owner Permits prior to the Effective Date, Owner shall obtain such Owner Permits
in accordance with the schedule contained in Attachment Q and Owner
shall provide Contractor with complete copies of such Owner Permits within five
(5) Business Days after obtaining them. 
The terms of all such Permits shall be compatible with Contractor’s
performance of the Work, and Owner shall promptly notify Contractor of any
changes to the terms of any such Owner Permit that impacts Contractor’s
performance of the Work under this Agreement. 
Owner shall provide information, assistance and documentation to
Contractor as reasonably requested in connection with the Contractor Permits.

 

4.3                                 Access to the Site and Off-Site Rights of Way and Easements.

 

A.                                   In
accordance with Attachment U and subject to the terms of this Agreement,
including Sections 3.24A and 4.3C, Owner shall provide Contractor with access
to and care and custody of the Site. 
Such access shall be sufficient to permit Contractor to progress with
construction on a continuous basis without material

 

33

 

interruption or interference by others.  To the extent that (i) any of Owner’s other
contractors or subcontractors working at the Site prior to Substantial
Completion or (ii) any Landowner accessing the Site prior to Substantial
Completion, in either case materially interrupts or interferes with Contractor’s
performance of the Work and such interruption or interference adversely affects
Contractor’s ability to perform the Work in accordance with the Project
Schedule or Contractor’s cost of performance of the Work, Contractor shall be entitled
to a Change Order; provided that
Contractor complies with the requirements in Sections 6.2, 6.5 and 6.9.

 

B.            Subject to Section 3.24B, the Contract Price is based on
Owner providing Contractor with access to the off-Site rights of way and
easements listed in Attachment Y (the “Off-Site
Rights of Way and Easements”) sufficient to permit Contractor to
progress with construction without material interruption or interference by
others while adhering to the reasonable instructions provided by Owner or the
applicable Landowner(s) in connection with Work performed within such Off-Site
Rights of Way and Easements.  To the
extent Contractor is not provided with sufficient access to such Off-Site
Rights of Ways and Easements to progress with construction without material
interruption or interference by others, and such interruption or interference
adversely affects Contractor’s cost of performance of the Work or Contractor’s
ability to perform the Work in accordance with the Project Schedule, Contractor
shall be entitled to a Change Order; provided that
(i) Contractor complies with the requirements set forth in Sections 6.2, 6.5
and 6.9 and (ii) at or prior to the Contract Date, Contractor did not know or
reasonably should have known (based on information made available by Owner to
Contractor or investigations made by Contractor prior to the Contract Date)
that its access was or would be restricted.

 

C.                                     Contractor
shall provide Owner access to the Site at all times.

 

4.4                                 Operation Personnel. 
Owner shall provide to Contractor a minimum of fifty (50) qualified and
competent operating and maintenance personnel sufficient to commission and test
the Facility under the supervision of Contractor as set forth in Attachment
V.  Until Substantial Completion,
such personnel shall be under the direction and control of and supervised by
Contractor.  Such operating and
maintenance personnel shall be available for training as required pursuant to
Section 3.5.  To the extent not set forth
in Attachment V, Contractor shall prepare for Owner’s review a Project
Commissioning Plan regarding the utilization of Owner’s operation and
maintenance personnel and Contractor’s personnel during commissioning and for
the conduct of Performance Tests.  Such Project
Commissioning Plan shall be mutually agreed-upon by the Parties, each acting
reasonably, no later than forty-five (45) Days after Owner’s receipt of
Contractor’s proposed Project Commissioning Plan.  Without in any way limiting Contractor’s
obligation to provide forces and labor during commissioning and Performance
Testing, Contractor agrees that if any activity during commissioning and
Performance Testing requires direct supervision by Contractor, such supervision
shall be performed by Contractor or a Subcontractor or Sub-subcontractor. Owner
shall remain responsible for all costs associated with Owner’s operation and
maintenance personnel, including salaries, travel and expenses.

 

4.5                                 Sales and Use Tax Matters.

 

A.                                   Owner
shall participate in the Louisiana Enterprise Zone Program, which

 

34

 

shall allow Owner to receive a rebate directly from
the State of Louisiana Department of Revenue of the rebatable portion of Louisiana
state, parish and local-option sales and use tax (“Louisiana
Sales and Use Tax”) incurred and paid by Contractor and its
Subcontractors or Sub-subcontractors in connection with performance of the
Work.  Contractor shall provide to Owner,
for itself and its Subcontractors and Sub-subcontractors, all documentation as
may be reasonably requested by Owner and available to Contractor and its
Subcontractors and Sub-subcontractors in order to allow Owner to secure such
rebate.  Such documentation shall include
invoice documentation supporting all Louisiana Sales and Use Taxes paid by
Contractor and its Subcontractors and Sub-subcontractors for the purchase of
Equipment, including purchases of Equipment made under lump sum contract
agreements.  Such invoice documentation
shall be provided to Owner on a timely basis and shall clearly identify (i) the item of Equipment
purchased, (ii) the amount of Louisiana Sales and Use Tax paid; and (iii) all
information (including Owner’s name, the taxpayer’s name, the Project name and
the Project address) to properly establish that the Equipment was used in
connection with or incorporated into the Facility.  If the Equipment was taken from Contractor’s,
Subcontractor’s or Sub-subcontractor’s inventory, subject to Section 4.5C, Contractor
shall provide Owner with an invoice, journal vouchers or other similar
documentation as may be required to evidence that the applicable Louisiana
Sales and Use Tax was paid by Contractor, Subcontractor or Sub-subcontractor on
such inventory.  Owner’s tax consultant (as
notified by Owner to Contractor) shall assist Owner to secure all available
rebates of Louisiana Sales and Use Taxes and is authorized to request and
receive information directly from Contractor and its Subcontractors and
Sub-subcontractors on behalf of Owner.  No
information shall be provided to Owner’s tax consultant until such tax
consultant has signed a confidentiality agreement with Contractor and any
applicable Subcontractor and Sub-subcontractor with terms customary in the
audit industry for audits of this kind.

 

B.                                     Owner
shall provide Contractor with any state and local manufacturing, pollution
control or other applicable sales and use tax exemption certificates which are
valid under Applicable Law, including the governing law specified in Section 21.9.  Contractor and Owner shall reasonably cooperate
with each other to minimize any and all Taxes relating to the Project.  If Contractor or any Subcontractor or
Sub-subcontractor incurs any sales and use taxes on any items of Equipment for
which Owner has previously provided Contractor with a valid applicable sales
and use tax exemption certificate, Contractor shall be responsible for the
payment of such sales and use taxes without reimbursement by Owner; provided, however, the foregoing provision shall not affect
Contractor’s right to a Change Order in accordance with Section 7.1A.

 

C.                                     Pursuant
to Section 3.14, Owner shall have the right to have its third party auditors
audit the Books and Records of Contractor and its Sub-contractors or
Sub-subcontractors to confirm that all Louisiana Sales and Use Taxes paid by
Contractor and its Subcontractors and Sub-subcontractors in connection with the
Work are properly owed under Applicable Law; provided,
however, if the determination of the proper amount of such Louisiana
Sales and Use Tax assessed on any one or more items of Equipment is dependent
upon knowing the actual cost incurred by Contractor or its Sub-contractors or
Sub-subcontractors for such item of Equipment and the compensation of such item
of Equipment is included in the Contract Price or in any lump sum Change Order,
that portion

 

35

 

of the audit devoted to reviewing the actual cost
incurred by Contractor or its Sub-contractors or Sub-subcontractors for such
item of Equipment shall be performed by Owner’s tax consultant, which shall be
retained by Owner at Owner’s sole expense. 
The Parties agree that (unless the amount of Louisiana Sales and Use Tax
properly payable for an item of Equipment is subject to litigation) such tax
consultant shall not disclose to Owner the actual cost incurred by Contractor
or its Sub-contractors or Sub-subcontractors for any item of Equipment included
in the Contract Price, but the Parties agree that such tax consultant may
report to Owner the proper Louisiana Sales and Use Taxes properly payable under
Applicable Law.  No access to Books and
Records shall be granted to Owner’s third party auditors until such auditors
have signed a confidentiality agreement with Contractor and any applicable
Subcontractor or Sub-subcontractor with terms customary in the audit industry
for audits of this kind.

 

4.6                                 Legal Description and Survey.   As of the Contract Date, Owner has provided
to Contractor (i) the legal description of the Site as set forth in Attachment
Y and (ii) a survey of the Site showing the boundaries of the Site and one
survey control point, prepared by Lonnie G. Harper & Associates, dated
January 26, 2004.  Contractor shall be
entitled to rely upon the accuracy of this information.  To the extent any existing structures or
utilities are shown in the survey, Contractor shall independently verify the
locations of such existing structures and utilities.

 

4.7                                 Hazardous Materials. 
Owner shall remove, transport and, as appropriate, dispose of any
Hazardous Materials discovered or released at the Site, including any Hazardous
Materials brought on the Site or generated by Third Parties, but excluding any
Hazardous Materials brought on to the Site or generated by Contractor or any of
its Subcontractors or Sub-subcontractors. 
In addition, as between Owner and Contractor, Owner shall be responsible
for any Hazardous Materials discovered or released within the Off-Site Rights
of Way and Easements, including any Hazardous Materials brought on the Off-Site
Rights of Way and Easements or generated by Third Parties but excluding any
Hazardous Materials brought on the Off-Site Rights of Way and Easements by
Contractor or any of its Subcontractors or Sub-subcontractors.  OWNER
SHALL DEFEND, INDEMNIFY AND HOLD HARMLESS CONTRACTOR GROUP FROM AND AGAINST ALL
DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES
AND LITIGATION OR ARBITRATION EXPENSES) INCURRED BY CONTRACTOR GROUP TO THE
EXTENT ARISING FROM ANY CONTAMINATION OR POLLUTION RESULTING FROM ANY HAZARDOUS
MATERIALS FOR WHICH OWNER IS RESPONSIBLE UNDER THIS SECTION 4.7.

 

4.8                                 Owner-Provided Items.

 

A.                                   Owner
shall be responsible for those items of information so identified in Attachment
A, including information defined as “Rely Upon” in the Design Basis
included in Attachment A, Schedule A-2 and for providing to
Contractor the information specified in Attachment U.  Contractor shall not be required to examine
or be deemed to have examined any such information and Owner shall remain fully
responsible for the accuracy, completeness and sufficiency of such
information.  If Owner makes a change to
any such information, or if Contractor discovers an error in such information
or non-compliance of such information with Applicable Law or Applicable Codes
and Standards, Contractor shall be entitled to a Change Order; provided  that Contractor
complies with the requirements set forth in Sections 6.2, 6.5 and 6.9.  All other information in the Design

 

36

 

Basis shall be the responsibility of Contractor.

 

B.                                     Owner
shall provide those items in Attachment A which are expressly listed as
being the obligation of Owner and the items listed in Attachment U (within
the times listed in Attachment U). 
The items already provided by Owner are listed in Attachment U.

 

4.9                                 LNG Tanker Release. 
Owner shall endeavor to obtain a release of Contractor Group and Owner
Group from the owner of any LNG tanker and related LNG cargo from any and all
damages, losses, costs and expenses arising out of or resulting from claims for
damage to or destruction of an LNG tanker and loss of the related LNG cargo or
personal injury or death of any employee, officer or director employed by the
company operating, owning or leasing such LNG tanker or owning the related LNG cargo
in connection with the delivery of LNG of any LNG tanker to the Project where
such damage, destruction, loss, injury or death occurs prior to Substantial
Completion.  Owner shall endeavor to
obtain a release which shall apply regardless of the cause of such damage,
destruction, injury or death, including the sole or joint negligence, breach of
contract or other basis of liability of any member of the Contractor Group and
any member of the Owner Group.

 

Article 5

COMMENCEMENT OF WORK, PROJECT SCHEDULE, AND SCHEDULING OBLIGATIONS

 

5.1                                 Commencement of Work. 
Upon Contractor’s receipt from Owner of the limited notice to proceed (“Limited Notice to Proceed” or “LNTP”), Contractor shall promptly
commence with the performance of the LNTP Work. 
The LNTP shall be issued in the form attached hereto as Attachment H,
Schedule H-1.  Contractor shall
not, and shall not be obligated to, commence performance of the LNTP Work until
receipt from Owner of such LNTP.

 

5.2                                 Limited Notice to Proceed/Notice to Proceed.

 

A.                                   Limited Notice to Proceed.  The portion of the Contract Price payable for
the LNTP Work shall be made in
accordance with the Payment Schedule set forth in Attachment C, Schedule
C-2 and the applicable provisions of Article 7.  Owner shall not issue the LNTP until the
following conditions have been met:

 

1.                                       Owner
has furnished to Contractor documentation which demonstrates that Owner has
sufficient funds to fulfill its payment obligations in connection with
Contractor’s performance of the LNTP Work, or that Owner has obtained financing
from one or more Lenders to fulfill its payment obligations in connection with
such LNTP Work;

 

2.                                       Owner
has obtained all Owner Permits that are necessary for performance of the LNTP
Work, or if Owner has not obtained all such Owner Permits at the commencement
of the LNTP Work, by issuance of the LNTP, Owner commits to obtain any such
remaining Owner Permits in such time so as to not delay the performance of
Contractor’s LNTP Work; and

 

3.                                       Owner
shall be in compliance with its other obligations set forth in

 

37

 

Article 4 as necessary for the LNTP Work.

 

B.                                     Notice to Proceed.  Contractor shall not, and shall not be
obligated to, commence performance of the Work (other than the LNTP Work) until
Owner issues the full notice to proceed (“Notice to Proceed”
or “NTP”) authorizing the same pursuant
to the terms and conditions of this Agreement. 
Upon Contractor’s receipt from Owner of the NTP, Contractor shall
promptly commence with the performance of the Work.  The NTP shall be issued in the form attached
hereto as Attachment H, Schedule H-2.  Contractor shall timely file in the required
superior court and post at the Site a notice of commencement as required under
La. Rev. Stat. §9:4801, et. seq. and shall provide copies of such notice
of commencement to Subcontractors and Sub-subcontractors as required under La.
Rev. Stat. §9:4801, et. seq. 
Owner shall not issue an NTP until the following conditions have been
met:

 

1.                                       Owner
has furnished to Contractor reasonable documentation which demonstrates that
Owner (i) has sufficient funds to fulfill its payment obligations under this
Agreement, or (ii) has obtained financing from one or more Lenders to fulfill
its payment obligations under this Agreement, including (a) satisfaction, or
waiver by Lenders, of all applicable conditions precedent to the occurrence of
the closing date of the financing, which shall be prior to or contemporaneous
with the issuance of the Notice to Proceed, and (b) evidence of the execution
of the credit agreement with respect to such financing by Owner and Lenders
(including a copy of such executed credit agreement);

 

2.                                       Owner
has obtained all Owner Permits (including the FERC Authorization) which are
shown in Attachment Q as required to be obtained prior to the issuance
of the NTP;

 

3.                                       Owner
has made payment to Contractor of all undisputed amounts owed as of the date of
the NTP that were earned in connection with Contractor’s performance of the
LNTP Work;

 

4.                                       the
Advance Payment has been received by Contractor in cleared funds;

 

5.                                       Owner
shall be in compliance with its other obligations set forth in Article 4 as
necessary for the commencement of the Work; and

 

6.                                       ninety
(90) Days or more have elapsed since Owner’s issuance of the LNTP and,
provided, in any event, that NTP shall not be issued earlier than April 4,
2005.

 

5.3                                 Project Schedule. 
Contractor shall perform the Work in accordance with the Project
Schedule.

 

A.                                   Guaranteed Substantial Completion Date.  Contractor shall achieve Substantial
Completion no later than the date specified in Attachment E (“Guaranteed Substantial Completion Date”).  The Guaranteed Substantial Completion Date
shall only

 

38

 

be adjusted by Change Order as provided under this
Agreement.

 

B.                                     Final Completion.  Contractor shall achieve Final Completion no
later than ninety (90) Days after achieving Substantial Completion for the
Facility.

 

5.4                                 CPM Schedule
Submissions.  On or before
Owner’s issuance of the Notice to Proceed, Contractor shall prepare and submit
to Owner for its review a detailed critical path method schedule for the Work (“CPM Schedule”), which shall be
detailed at a Level II for all activities for the Project (including
engineering, procurement, construction, pre-commissioning, commissioning,
testing and startup). In addition, no later than one hundred and twenty (120)
Days after the delivery of the initial CPM Schedule by Contractor to Owner,
Contractor shall submit to Owner for its review a revised CPM Schedule, which
shall be detailed at a Level III for all activities for the Project (including
engineering, procurement, construction, pre-commissioning, commissioning,
testing and startup).  The initial CPM
Schedule shall govern Contractor’s Work until the revised CPM Schedule is
prepared and reviewed by Owner.  Each of
the initial and revised CPM Schedules shall be referred to as the “CPM
Schedule,” and each shall comply with the requirements of this Section 5.4 and
shall be provided to Owner in its native electronic format.  The CPM Schedule shall be prepared by
Contractor using Primavera Project Planner (P3).  Without limitation of the foregoing, the CPM
Schedule shall include the information and meet the requirements set forth in
Section 9.4 of Attachment A.

 

5.5                                 Recovery and Recovery Schedule.  If, at any time during the prosecution of the
Work, (i) should the Monthly Progress Report show that any activity on the
critical path is forty-five (45) or more Days behind schedule, or should
Contractor fail to provide a Monthly Progress Report in compliance with the
requirements of this Agreement and Owner reasonably determines that any
activity on the critical path is forty-five (45) or more Days behind schedule
and (ii) Contractor or any of its Subcontractors or Sub-subcontractors are in
Owner’s reasonable judgment responsible for such delay, Owner may, in addition
to any other remedies that it may have under this Agreement, require that
Contractor prepare a schedule to explain and display how it intends to regain
compliance with the CPM Schedule (“Recovery Schedule”).
Within ten (10) Business Days after the determination by Owner of the
requirement for a Recovery Schedule, Contractor shall prepare the Recovery
Schedule and submit it to Owner for its review. 
The Recovery Schedule shall (i) represent Contractor’s best judgment as
to how it shall regain compliance with the CPM Schedule, (ii) be prepared in
accordance with GECP, (iii) have a level of detail sufficient for Contractor to
direct, manage and perform the Work, and (iv) have a maximum duration of sixty
(60) Days unless recovery cannot be reasonably achieved in such time, in which
case the duration of the Recovery Schedule shall be for that period of time
reasonably necessary to regain compliance with the CPM Schedule.  Contractor shall address all comments
received from Owner during Owner’s review of the Recovery Schedule, and
Contractor shall provide a written statement describing why any of Owner’s
comments or proposed changes to the Recovery Schedule were not implemented by
Contractor.  Any of Owner’s comments or
proposed changes to the Recovery Schedule that Contractor implements should be
reflected in the revised Recovery Schedule. 
The revised Recovery Schedule shall then be the schedule which
Contractor shall use in planning, organizing, directing, coordinating,
performing, and executing the Work (including all activities of Subcontractors
and Sub-subcontractors) to regain compliance with the CPM Schedule.  The cost of preparing and executing the
Recovery Schedule shall be at Contractor’s sole cost and expense; provided, however, if the preparation of a Recovery Schedule
is combined with

 

39

 

a request by Owner
for a Change Order and the cost of preparing the Change Order for such request
(excluding any costs associated with recovery) exceeds Thirty Thousand U.S.
Dollars ($30,000), then Contractor is entitled to reimbursement for such
preparation costs in accordance with Section 6.1A.  Owner’s review and comments regarding the
Recovery Schedule shall not relieve Contractor of any obligations for
performance of the Work, change the Guaranteed Substantial Completion Date or
be construed to establish the reasonableness of the Recovery Schedule.

 

5.6                                 Acceleration and Acceleration Schedule.

 

A.                                   Even
if the Work is otherwise in compliance with the CPM Schedule, Owner may, at any
time, direct Contractor in writing to advance one or both of the Target Bonus
Date and Guaranteed Substantial Completion Date; provided,
however, such directive shall be reasonable and Contractor shall
have agreed in writing that such acceleration is commercially and technically
feasible and, provided  further
no such directive shall adversely affect Contractor’s ability to earn the Schedule
Bonus in accordance with Section 11.9.  For
the purposes of this Section 5.6A, Contractor’s ability to earn the Schedule
Bonus would be adversely affected if Contractor would achieve the Schedule
Bonus but for the directive.  In the event
of such agreement, the directive shall be termed herein a “Confirmed Acceleration Directive”
and shall be set forth in a Change Order. 
In no event shall Owner have the right to issue a unilateral
acceleration directive requiring Contractor to achieve Substantial Completion
prior to the original Guaranteed Substantial Completion Date specified in this
Agreement as of the Contract Date, nor shall Owner have the have the right to
issue a unilateral acceleration directive requiring Contractor to achieve Target
Completion prior to the original Target Bonus Date specified in this Agreement
as of the Contract Date.  In the event of
a Confirmed Acceleration Directive, Owner shall pay Contractor for the
documented costs plus fee attributable to such acceleration and appropriate
incentives, if any, shall be mutually agreed upon by the Parties with respect
to such early proposed completion and set forth in the Change Order.  Such costs may include any shift
differential, premium, or overtime payments to workers or field supervisors and
other employees of Contractor dedicated to the Work on a full-time basis
actually incurred over and above Contractor’s normal rates, and overtime
charges for Construction Equipment.  Any
adjustment to the Contract Price or any other Changed Criteria necessitated by
such acceleration of the Work shall be implemented by Change Order.  Upon execution of the Change Order,
Contractor shall immediately commence and diligently perform the acceleration of
the Work, and shall prepare a schedule to explain and display how it intends to
accelerate the Work and how that acceleration will affect the critical path of
the CPM Schedule (the “Acceleration Schedule”).  With respect to the Acceleration Schedule,
Contractor shall do the following:

 

1.                                       No
later than the tenth (10th) Business Day after execution of the
Change Order with respect to the Confirmed Acceleration Directive, Contractor
shall prepare the Acceleration Schedule and submit it to Owner for its
review.  The Acceleration Schedule shall
represent Contractor’s best judgment as to how it shall satisfy the Confirmed
Acceleration Directive.  The Acceleration
Schedule shall be prepared using GECP and to a similar level of detail as the
CPM Schedule.

 

40

 

2.                                       On
the tenth (10th) Business Day after execution of the Change Order
with respect to the Confirmed Acceleration Directive (or such longer time as
specified in writing by Owner), Contractor shall participate in a conference
with Owner, and with any other Person (including Subcontractors and
Sub-subcontractors) whom Owner reasonably designates to participate, to review
and evaluate the Acceleration Schedule. 
Any revisions to the Acceleration Schedule necessary as a result of this
review shall be resubmitted for review by Owner as soon as reasonably
practicable or as mutually agreed by the Parties.  The revised Acceleration Schedule shall then
be the schedule which Contractor shall use in planning, organizing, directing,
coordinating, performing, and executing that portion of the Work that is
affected by such acceleration, with the CPM Schedule governing the performance
of all other Work.

 

Owner’s review of the
Acceleration Schedule shall not constitute an independent evaluation or
determination by Owner of the workability, feasibility, or reasonableness of
that schedule.

 

Article 6

CHANGES; FORCE MAJEURE; AND OWNER-CAUSED DELAY

 

6.1                                 Change Orders Requested by Owner.  Until Substantial Completion, Owner shall be
entitled to a Change Order upon request in accordance with this Section 6.1.

 

A.                                   If
Owner submits to Contractor in writing a duly signed proposed Change Order,
Contractor must respond to Owner, to the extent practicable, within thirty (30)
Days with a written statement setting forth the effect, if any, which such
proposed Change Order would have on the Contract Price (including any
adjustments in the Contract Price or Project Schedule resulting from a proposed
Change Order issued with respect to any of the items identified in Section 12.3
of Schedule A-1), the Project Schedule, the Design Basis, the Payment
Schedule, any of the Minimum Acceptance Criteria, Performance Guarantees or
Guarantee Conditions, and/or any other obligation or potential liability of
Contractor hereunder (collectively or individually, the “Changed
Criteria”).  The written
statement shall be in the form of Schedule D-3, and shall include,
to the extent practicable, all information required by Section 6.5B.  Owner shall respond to Contractor’s written
statement within fourteen (14) Business Days of receipt, responding to
Contractor’s statement as to the effects of the proposed Change Order on the
Changed Criteria.  If it is not practicable
for Contractor to provide all of the information required under this Section 6.1A
to be submitted with such written statement within such thirty (30) Day period,
Contractor shall provide Owner with as much information as practicable as well
as a written explanation of the reason additional time is required.  To the extent Contractor incurs costs
exceeding Thirty Thousand U.S. Dollars (U.S.$30,000) (which costs shall be
adequately documented and supported by Contractor) in responding to any one
proposed Change Order, Contractor shall be reimbursed for such excess costs in
responding to such Change Order within twenty-five (25) Days
after receipt of Contractor’s invoice therefor; provided
that Contractor first gives Owner written notice of the estimate of
the cost of such preparation before preparing the response, such estimate is in
excess of Thirty Thousand U.S. Dollars (U.S.$30,000), Owner approves in writing
the preparation of the response,

 

41

 

and such proposed Change Order is not implemented.

 

B.                                     If
the Parties agree on such Changed Criteria of the proposed Change Order (or
modify such proposed Change Order so that the Parties agree on such Changed
Criteria), the Parties shall execute such Change Order incorporating the
Changed Criteria, which shall be in the form of Schedule D-1, and
such Change Order shall become binding on the Parties, as part of this
Agreement.

 

C.            If the Parties cannot agree on such Changed Criteria of
the proposed Change Order within ten (10) Days of Contractor’s receipt of
Owner’s response to Contractor’s written statement, or if Owner desires that
the proposed changed Work set forth in the proposed Change Order commence
immediately without the requirement of a written statement by Contractor as
required under Section 6.1A, Owner may (subject to this Section 6.1C), by issuance
of a unilateral Change Order in the form attached hereto as Schedule D-2,
require Contractor to commence and perform the changed Work specified in the
unilateral Change Order on a time and material basis as set forth in Schedule
D-4 with the effect of such unilateral Change Order on the Changed Criteria
(or if the Parties agree on the effect of such unilateral Change Order for some
but not all of the Changed Criteria, the impact of each of the components of
the Changed Criteria on which the Parties disagree) to be determined as soon as
possible but without prejudice to Contractor’s right to refer any Dispute for
resolution in accordance with Article 18. 
The rates specified in Schedule D-4 are “Unit
Rates,” and the Unit Rates and all other Reimbursable Costs
shall be used to the extent applicable to the changed Work.  The Parties acknowledge and agree that
unilateral Change Orders submitted by Owner in accordance with this Section
6.1C shall be limited to additions or modifications to, or deductions from the
Work and that Owner shall not have the unilateral right to change, amend or
modify any of the other Changed Criteria or the terms of this Agreement.  Pending resolution of the Dispute, Contractor
shall perform the Work as specified in such unilateral Change Order and Owner
shall continue to pay Contractor in accordance with the terms of this Agreement
and any previously agreed Change Orders. 
When Owner and Contractor agree on the effect of such unilateral Change
Order on all of the Changed Criteria, such agreement shall be recorded by
execution by the Parties of a Change Order in the form attached hereto as Schedule
D-1, which shall supersede the unilateral Change Order previously issued
and relating to such changed Work.  With
the exception of any Contract Price adjustment contemplated under Sections 7.1A
through 7.1H, in no event shall Owner be entitled to issue any unilateral
Change Order in accordance with this Section 6.1C where such unilateral Change
Order (i) would result in an increase equal to or exceeding an amount equal to
five percent (5%) of the Contract Price as originally set forth in Section 7.1,
or (ii) in conjunction with other unilateral Change Orders issued by Owner
(other than any Contract Price adjustment contemplated under Sections 7.1A
through 7.1H), would in themselves result in an increase equal to or exceeding
an amount equal to ten percent (10%) of the Contract Price as originally set
forth in Section 7.1.  For the avoidance
of doubt, the Parties agree that the adjustments contemplated under Sections
7.1A through 7.1H do not constitute unilateral Change Orders.

 

D.                                    In
the event of a change in any Applicable Code and Standard which does not
constitute a Change in Law, Contractor shall provide written notice to Owner
regarding

 

42

 

such change. 
Upon receipt of such notice from Contractor, Owner may submit a proposed
Change Order to Contractor in accordance with this Section 6.1 in the event
Owner, at its sole option, elects for Contractor to implement such change in
Applicable Code and Standard.  In the
event Owner does not, at its sole option, elect for Contractor to implement
such change in Applicable Code and Standard, Contractor shall not be required
to perform in accordance with such Applicable Code and Standard.  In the event, however, that compliance with
such Applicable Code and Standard is mandatory for Contractor to comply with
GECP and Owner does not, at its sole option, after receipt of written notice
from Contractor regarding same, elect for Contractor to implement such change
in Applicable Code and Standard, then Owner waives its rights to claim a breach
of GECP with respect to such change in Applicable Code and Standard.

 

6.2                                 Change Orders Requested by Contractor.

 

A.                                   Contractor
shall have the right to a Change Order in the event of any of the following
occurrences:

 

1.                                       Any
Change in Law that adversely affects (i) Contractor’s costs of performance of
the Work; (ii) Contractor’s ability to perform the Work in accordance with the
Project Schedule or (iii) Contractor’s ability to perform any material
obligation under this Agreement;

 

2.                                       Acts
or omissions of any member of Owner Group or any other Person for whom Owner is
responsible, including in the case of Owner any failure to perform any
obligation under this Agreement, that
adversely affects (i) Contractor’s costs of performance of the Work, (ii)
Contractor’s ability to perform the Work in accordance with the Project
Schedule or (iii) Contractor’s ability to perform any material obligation under
this Agreement; provided that Contractor shall
not be entitled to a Change Order to the extent that such acts or omissions of
Owner are caused, directly or indirectly, by Contractor’s failure to perform
its obligations under this Agreement;

 

3.                                       Force
Majeure to the extent allowed under Section 6.8A;

 

4.                                       Acceleration
of the Work directed by Owner pursuant to Section 5.6, provided
that a Change Order has been issued;

 

5.                                       Owner’s
request for an increase in coverage under the Letter of Credit pursuant to
Section 9.2 to cover any increase in the Contract Price as a result of Change
Orders to the extent set forth in Section 9.2;

 

6.                                       To
the extent expressly permitted under Sections 3.3C, 4.3A, 4.3B, 4.8A, 7.1, 8.2A,
11.2, 12.2A and 16.4;

 

7.                                       Delay
beyond the permissible times specified in Section 1A.9(g)(i) or Section
1A.11(ii) of Attachment O for the delivery by Owner to Contractor of
builder’s risk or marine cargo insurance proceeds received by the Collateral
Agent shall relieve Contractor of any obligation under this Agreement to effect
repairs or

 

43

 

other restoration of the Work affected by the insured
occurrence for any costs of repairs or restoration exceeding the sum of the
deductible under such insurance and any amounts previously paid to Contractor
under such insurance and shall entitle Contractor to a Change Order adjusting
the Contract Price and Project Schedule, but only to the extent such delay
adversely affects (i) Contractor’s cost of performance of the Work, (ii)
Contractor’s ability to perform the Work in accordance with the Project
Schedule, or (iii) or Contractor’s ability to perform any material obligation
under this Agreement;  provided that,
notwithstanding the foregoing, in no event shall this Section 6.2A.7 in any way
relieve Contractor from any obligation to perform any work necessary to
maintain the builder’s risk and marine cargo insurance in full force and
effect;

 

8.                                       Suspension
in Work ordered by Owner pursuant to Section 16.3;

 

9.                                       Subsurface
Soil Conditions to the extent allowed under Section 2.5B.2;

 

10.                                 Discovery
of Hazardous Materials at the Site or on the Off-Site Rights of Way and
Easements for which Owner is responsible under Section 4.7 that adversely
affects (i) Contractor’s costs of performance of the Work, (ii) Contractor’s
ability to perform the Work in accordance with the Project Schedule or (iii)
Contractor’s ability to perform any material obligation under this Agreement;

 

11.                                 Owner’s
issuance of (i) the LNTP in accordance with Section 5.2A after January 4, 2005
or (ii) the NTP in accordance with Section 5.2B after April 4, 2005, but only
to the extent that such delay adversely affects (i) Contractor’s costs of
performance of the Work, (ii) Contractor’s ability to perform the Work in
accordance with the Project Schedule or (iii) Contractor’s ability to perform
any material obligation under this Agreement; and

 

12.                                 Owner’s
election to issue a Change Order with respect to any of the items identified in
Section 12.3 of Schedule A-1, but only to the extent the implementation
of any such activity previously identified as an exclusion adversely impacts (i)
Contractor’s cost of performance of the Work, (ii) Contractor’s ability to
perform the Work in accordance with the Project Schedule or (iii) Contractor’s
ability to perform any obligation under this Agreement.

 

B.                                     Should
Contractor desire to request a Change Order under this Section 6.2, Contractor
shall, pursuant to Section 6.5, notify Owner in writing and issue to Owner, at
Contractor’s expense, a request for a proposed Change Order in the form
attached hereto as Schedule D-3, a detailed explanation of the
proposed change and Contractor’s reasons for proposing the change,
documentation necessary to verify the effects of the change on the Changed
Criteria, and all other information required by Section 6.5.  Any adjustments to the Contract Price shall
(unless otherwise agreed) be requested on a lump sum basis and shall be based
on the requirements in Schedule D-4 and the Unit Rates specified therein
to the extent applicable to the Change Order.

 

44

 

C.                                     Owner
shall respond to Contractor’s request for a Change Order within twenty (20)
Days of receipt, stating (i) whether Owner agrees that Contractor is entitled
to a Change Order and (ii) the extent, if any, to which Owner agrees with
Contractor’s statement regarding the effect of the proposed Change Order on the
Changed Criteria, including any adjustment to the Contract Price and the
estimated costs for each item making up the adjustment to the Contract
Price.  If Owner agrees that a Change
Order is necessary and agrees with Contractor’s statement regarding the effect
of the proposed Change Order on the Changed Criteria, including mutual
agreement on the costs, then Owner shall issue such Change Order, which shall
be in the form of Schedule D-1, and such Change Order shall become
binding on the Parties as part of this Agreement upon execution thereof by the
Parties.  Owner shall be entitled to
decline a Change Order with respect to any request by Contractor for a Change
Order if the Change Order request, when submitted, is not adequately documented
and supported by Contractor as required under this Agreement.

 

D.                                    If
the Parties agree that Contractor is entitled to a Change Order but cannot
agree on the effect of the proposed Change Order on the Changed Criteria within
thirty (30) Days of Owner’s receipt of Contractor’s written notice and proposed
Change Order and all other required information, or if Owner desires that the
proposed changed Work set forth in the proposed Change Order commence
immediately, the rights, obligations and procedures set forth in Section 6.1C
are applicable.

 

E.                                      If
the Parties cannot agree upon whether Contractor is entitled to a Change Order
within thirty (30) Business Days of Owner’s receipt of Contractor’s written
notice and proposed Change Order, then the Dispute shall be resolved as
provided in Article 18.  Pending resolution of the Dispute, Contractor
shall continue to perform the Work required under this Agreement, and Owner
shall continue to pay Contractor in accordance with the terms of this
Agreement, any Change Orders and any previously agreed or unilateral Change
Orders.

 

6.3                                 Contract Price Adjustment; Contractor Documentation.  If a Change Order is executed on a time and
material basis pursuant to Section 6.1C or 6.2D, then the Contract Price shall
be adjusted as set forth in Schedule D-4.  Contractor shall use reasonable efforts to
minimize such costs (consistent with the requirements of this Agreement).

 

6.4                                 Change Orders Act as Accord and Satisfaction.  Unless otherwise expressly stated in the
Change Order, Change Orders agreed pursuant to Section 6.1B or 6.2C by the
Parties shall constitute a full and final settlement and accord and
satisfaction of all effects of the change as described in the Change Order upon
the Changed Criteria and shall be deemed to compensate Contractor fully for
such change.  Accordingly, unless otherwise expressly stated in such Change Order,
Contractor expressly waives and releases any and all right to make a claim or
demand or to take any action or proceeding against Owner for any other
consequences arising out of, relating to, or resulting from such change
reflected in such Change Order, whether the consequences result directly or
indirectly from such change reflected in such Change Order, including any claim
or demand for damages due to delay, disruption, hindrance, impact,
interference, inefficiencies or extra work arising out of, resulting from, or
related to, the change reflected in that Change Order (including any claims or
demands that any Change Order or number of Change Orders,

 

45

 

individually or in the aggregate, have
impacted the unchanged Work).

 

6.5                                 Timing Requirements for Notifications and Change Order Requests by
Contractor.  Should Contractor
desire to seek an adjustment to the Contract Price, the Project Schedule, the
Payment Schedule, any of the Minimum Acceptance Criteria or Performance
Guarantees or any other modification to any other obligation of Contractor
under this Agreement for any circumstance that Contractor has reason to believe
may give rise to a right to request the issuance of a Change Order, Contractor
shall, with respect to each such circumstance:

 

A.                                   notify
Owner in writing of the existence of such circumstance within twenty (20) Days
of the date that Contractor knew of the first occurrence or beginning of such
circumstance; provided however, if such
circumstance is an emergency, notice shall be given as soon as reasonably
practicable.  In such notice, Contractor
shall state in detail all known and presumed facts upon which its claim is
based, including the character, duration and extent of such circumstance, the
date Contractor first knew of such circumstance, any activities impacted by
such circumstance, a good faith estimate of the cost (which such costs shall be
adequately documented and supported by Contractor) and time consequences of such
circumstance (including showing a good faith estimate of the impact of such
circumstance, if any, on the critical path of the CPM Schedule) and any other
details or information that are expressly required under this Agreement.  Contractor shall only be required to comply
with the notice requirements of this Section 6.5A once for continuing
circumstances, provided  that
the notice expressly states that the circumstance is continuing and includes
Contractor’s best estimate of the time and cost consequences of such
circumstance; and

 

B.                                     submit
to Owner a request for a Change Order as soon as reasonably practicable after
giving Owner written notice but in no event later than forty-five (45) Days
after the completion of each such circumstance, together with a written
statement with all information currently available (i) detailing why Contractor
believes that a Change Order should be issued, plus all documentation
reasonably requested by Owner, including information and details expressly
required under this Agreement (including the information required by Schedule D-4,
applicable detailed estimates and cost records and a graphic demonstration
using the CPM Schedule and Monthly Progress Reports showing Contractor’s
entitlement to a time extension to the Project Schedule pursuant to the terms
of this Agreement); and (ii) setting forth the effect, if any, which such
proposed Change Order has or would have for the Work on any of the Changed
Criteria.  Contractor shall promptly supplement
its request for Change Order with additional information as such additional
information (if any) becomes available.

 

If Contractor fails to
provide the notice as required under this Section 6.5, and if Owner
demonstrates that it has been prejudiced on account of such failure to provide
notice, then, to the extent that Owner is so prejudiced, Contractor waives its
right for, and releases Owner from and against any claims for, adjustments in
the Contract Price, the Project Schedule, Payment Schedule, any Work, any of
the Minimum Acceptance Criteria or Performance Guarantees or any other
modification to any other obligation of Contractor under this Agreement.  Oral notice, shortness of time, or Owner’s
actual knowledge of a particular circumstance shall not waive, satisfy,
discharge or otherwise excuse

 

46

 

Contractor’s strict
compliance with this Section 6.5. 
Contractor shall have the burden of proof with respect to any claim made
by it.

 

6.6                                 Evidence of Funds.  With
the exception of any Contract Price adjustment contemplated under Sections 7.1A
through 7.1H, Contractor shall not be obligated to proceed with any Change
Order that, alone or in conjunction with other Change Orders, would result in
an increase exceeding an amount equal to five percent (5%) of the Contract
Price unless Owner furnishes, to Contractor’s reasonable satisfaction,
documentation which demonstrates either that Owner has (i) sufficient funds to
pay for such Change Order, or (ii) obtained financing from one or more Lenders in
sufficient funds to pay for such Change Order.

 

6.7                                 Adjustment Only Through Change Order.  Unless otherwise provided in this Agreement,
no change in the requirements of this Agreement, whether an addition to,
deletion from, suspension of or modification to this Agreement, including any
Work, shall be the basis for an adjustment for any change in the Contract
Price, the Project Schedule, Payment Schedule, any Work, any of the Minimum
Acceptance Criteria or Performance Guarantees or any other obligations of
Contractor or right of Owner under this Agreement unless and until such
addition, deletion, suspension or modification has been authorized by a Change
Order executed and issued in accordance with and in strict compliance with the
requirements of this Section 6.7. 
Contractor shall not perform any change in the Work unless and until
such change is authorized pursuant to this Section 6.7, and should Contractor
perform or claim to perform any changes in the Work prior to authorization by
Change Order, all such costs and expenses incurred by Contractor shall be for
Contractor’s account.  No course of
conduct or dealings between the Parties, nor implied acceptance of additions,
deletions, suspensions or modifications to this Agreement, including any Work,
and no claim that Owner has been unjustly enriched by any such addition,
deletion, suspension or modification to this Agreement, whether or not there is
in fact any such unjust enrichment, shall be the basis for any claim for an
adjustment in the Contract Price, the Project Schedule, the Payment Schedule,
any Work, any of the Minimum Acceptance Criteria or Performance Guarantees or
any other obligations of Contractor under this Agreement.

 

6.8                                 Force Majeure.

 

A.                                   Contractor Relief.  If the commencement, prosecution or
completion of the Work is prevented or delayed by Force Majeure (including the
effects of such Force Majeure), then Contractor shall be entitled to an
extension to the Target Bonus Date and/or the Guaranteed Substantial Completion
Date to the extent, if any, permitted under Section 6.8A.1 and an adjustment to
the Contract Price to the extent, if any, permitted under Section 6.8A.2, provided that Contractor has complied with the notice and
Change Order requirements in Section 6.5 and the mitigation requirements in
Section 6.11.  In addition, if Force
Majeure (including the effects of such Force Majeure) prevents Contractor’s
performance with respect to any portion of the Work, Contractor shall, subject
to Section 6.11, be relieved from performance of such portion of the Work for
the time period that such Force Majeure, or the effects of such Force Majeure,
are continuing.  All time extensions to
the Project Schedule and adjustments to the Contract Price for such delays or
preventions shall be by Change Order implemented and documented as required
under Article 6.

 

47

 

1.                                       Time Extension. 
Contractor shall be entitled to an extension to the Target Bonus Date and/or
the Guaranteed Substantial Completion Date for delay or prevention that meets
the requirements of Section 6.8A, if and to the extent such delay or prevention
causes a delay in the critical path of the Work.  Contractor shall
demonstrate to Owner its entitlement to relief under this Section by providing
to Owner an updated CPM Schedule using Primavera Project Planner (P3) in its
native electronic format with actual durations entered for all activities on
the critical path and re-forecasted clearly to indicate Contractor’s
entitlement to a time extension under this Section 6.8A.

 

2.                                       Compensation. Contractor shall be
entitled to an adjustment to the Contract Price for any delay or prevention
that meets the requirements of Section 6.8A, if such delay or prevention
occurs for a continuous period of at least thirty (30) Days.  If Contractor is
entitled to such adjustment to the Contract Price, the adjustment to the
Contract Price shall only include reimbursement for the standby time for
Contractor’s employees and Construction Equipment and other standby expenses
which are incurred by Contractor after the expiration of such thirty (30) Day
period and which are caused by such Force Majeure and the effects thereof.  Reimbursement for such standby costs shall be
in the amount of Ninety-Three Thousand Seven Hundred Fifty U.S. Dollars
(U.S.$93,750) per Day that the Force Majeure event, or the effects of such
Force Majeure, continues, up to an aggregate amount of Three Million Seven
Hundred Fifty Thousand U.S. Dollars (U.S.$3,750,000).

 

B.                                     Owner Relief.  Subject to Section 6.8C, Owner’s obligations
under this Agreement shall be suspended to the extent that performance of such
obligations is delayed or prevented by Force Majeure, but without prejudice to
Contractor’s entitlement to a Change Order to the extent set forth in Section
6.2A.

 

C.                                     Payment Obligations.  No obligation of a Party to pay moneys under
or pursuant to this Agreement shall be excused by reason of Force Majeure.

 

6.9                                 Extensions of Time and Adjustment of Compensation.  With respect to any of the circumstances set
forth in Section 6.2A which cause delay of the commencement, prosecution or
completion of the Work for which Contractor is entitled to a Change Order (with
the exception of delay resulting from an event of Force Majeure, which shall be
governed in accordance with Section 6.8), Contractor shall be entitled to an
extension to the Target Bonus Date and/or Guaranteed Substantial Completion
Date if and to the extent: (i) such delay causes a delay in the critical path
of the Work; (ii) Contractor has complied with the notice and Change Order
requirements in Section 6.5 and the mitigation requirements of Section 6.11;
and (iii) such delay is not attributable to Contractor or any of its
Subcontractors or Sub-subcontractors.  Contractor shall demonstrate to Owner its
entitlement to relief under this Section by providing to Owner an updated CPM
Schedule using Primavera Project Planner (P3) in its native electronic format
with actual durations entered for all activities on the critical path and
re-forecasted clearly to indicate Contractor’s entitlement to a time extension
under this Section 6.9. 
Contractor shall be entitled to an adjustment to the Contract Price for
reasonable, additional costs incurred by Contractor for delay or in mitigation
or avoidance of a delay which would otherwise meet such requirements of

 

48

 

this Section 6.9.  For the
avoidance of doubt, Section 6.9 shall govern the determination of any right of
Contractor to an adjustment to the Target Bonus Date and/or the Guaranteed
Substantial Completion Date for delay unless such delay is caused by Force
Majeure.

 

6.10                           Delay. For the purposes of this Agreement, the term “delay”
shall include hindrances, disruptions or obstructions, or any other similar
term in the industry and the resulting impact from such hindrances, disruptions
or obstructions, including inefficiency, impact, ripple or lost production.

 

6.11                           Contractor Obligation to Mitigate Delay.  Contractor shall not be entitled to any
adjustment to the Project Schedule or adjustment to the Contract Price for any
portion of delay to the extent Contractor could have taken, but failed to take,
reasonable actions to mitigate such delay.

 

Article 7

CONTRACT PRICE AND PAYMENTS TO CONTRACTOR

 

7.1                                 Contract Price.  As
compensation in full to Contractor for the full and complete performance of the
Work and all of Contractor’s other obligations under this Agreement, Owner
shall pay and Contractor shall accept Six Hundred Forty-Six Million, Nine Hundred
Thirty-Six Thousand U.S. Dollars (U.S.$646,936,000) (the “Contract
Price”) plus payment for Reimbursable Costs which Contractor is
entitled to receive under the terms of this Agreement.  The Contract Price is subject to adjustment
only by Change Order as provided in Article 6, and includes all Taxes payable
by Contractor and its Subcontractors and Sub-subcontractors in connection with
the Work, the Louisiana Sales and Use Tax Allowance, the Insurance Allowance,
the Operating Spare Part Allowance, and costs, charges, and expenses of
whatever nature necessary for performance of the Work.

 

A.                                   Louisiana Sales and Use Tax Allowance.  Included in the Contract Price is an allowance
of Fourteen Million Three Hundred Sixteen Thousand U.S. Dollars ($14,316,000)
for Louisiana Sales and Use Taxes arising in connection with the Work (“Louisiana Sales and Use Tax Allowance”).  If the actual amount of Louisiana Sales and
Use Taxes paid by Contractor and its Subcontractors and Sub-subcontractors is
less than the Louisiana Sales and Use Tax Allowance, Owner shall be entitled to
a Change Order reducing the Contract Price by such difference.  If the actual amount of Louisiana Sales and
Use Taxes paid by Contractor and its Subcontractors and Sub-subcontractors is
greater than the Louisiana Sales and Use Tax Allowance, Contractor shall be
entitled to a Change Order increasing the Contract Price by such difference; provided that Contractor shall reasonably cooperate with
Owner to minimize any and all Louisiana Sales and Use Taxes arising in
connection with the Work, and provided further that
in the event Owner discovers that it has paid Contractor for any improperly
assessed Louisiana Sales and Use Taxes, Contractor shall reasonably assist
Owner in the recovery of such refunds and overpayments.

 

B.                                     Insurance Allowance.  Included in the Contract Price is an allowance
of Five Million Six Hundred Thousand U.S. Dollars (U.S.$5,600,000) for the cost
of insurance premiums for the builders risk insurance, marine cargo insurance,
delay in

 

49

 

startup insurance, marine delay in startup insurance,
charterer legal liability insurance, and marine terminal liability operations
insurance (the “Project Insurances”) required
to be provided by Contractor in accordance with Attachment O (“Insurance Allowance”).  On or before the date Owner issues the NTP,
Contractor shall notify Owner in writing of the actual cost of the insurance
premiums charged to Contractor by Contractor’s insurance carrier for the Project
Insurances (“Actual Insurance Cost”),
which Actual Insurance Cost shall be adequately documented by Contractor. If
the Actual Insurance Cost is less than the Insurance Allowance, Owner shall be
entitled to a Change Order reducing the Contract Price by such difference.  If the Actual Insurance Cost is greater than
the Insurance Allowance, Contractor shall be entitled to a Change Order
increasing the Contract Price by such difference.  Contractor shall be responsible for the
placement of the Project Insurances required to be provided by Contractor in
accordance with Attachment O, provided that Contractor
shall reasonably cooperate with Owner to minimize such Actual Insurance Cost to
the extent reasonably practicable.

 

1.                                       The
Contract Price has been based upon naming the Owner Group as additional
insureds on the commercial general liability and umbrella or excess liability
policies specified in Section 1A.2 and 1A.4 of Attachment O and
providing sudden and accidental pollution liability coverage (including clean
up on or off the Site) under such commercial general liability policy.  Accordingly, should (i) the insurance
provider(s) charge any additional premium for naming the Owner Group as named insureds
under such policies as compared to naming the Owner Group as additional
insureds or (ii) Contractor not be able to procure such sudden and accidental
liability coverage and, instead, is required to procure a stand-alone pollution
policy, Contractor shall be entitled to a Change Order increasing the Contract
Price in the actual amount of such increased premium associated with naming the
Owner Group as named insureds rather than additional insureds or procurement of
such stand-alone pollution policy.

 

C.                                     Operating Spare Part Allowance.         Included
in the Contract Price is an allowance of Two Million Eight Hundred Thousand
U.S. Dollars (U.S.$2,800,000) for supply and delivery of Operating Spare Parts
(“Operating Spare Part Allowance”).  If the actual cost charged to Contractor for
the supply and delivery of Operating Spare Parts provided to Owner under this
Agreement is less than the Operating Spare Part Allowance, Owner shall be
entitled to a Change Order reducing the Contract Price by such difference.  If the actual cost for the supply and
delivery of Operating Spare Parts provided to Owner under this Agreement is
greater than the Operating Spare Part Allowance, Contractor shall be entitled
to a Change Order increasing the Contract Price by such difference.

 

D.                                    Stainless Steel Adjustment.  On the date Owner issues the NTP, the
Contract Price shall be subject to an upward or downward adjustment by Change
Order to account for changes in the commodity pricing of 304L stainless steel
pipe, fittings and flanges, as set forth in Section 1 of Attachment EE (the
“Stainless Steel Adjustment”).

 

E.                                      Tank Subcontract Materials Adjustment.  The Contract Price shall be subject to an
upward or downward adjustment by Change Order to account for changes in the
commodity pricing of certain materials used in the Tanks, as set forth in Section
3 of

 

50

 

Attachment EE
(the “Tank Subcontract Materials Adjustment”).

 

F.                                      Marine Loading Arm Adjustment.  On the date Owner issues the NTP, the
Contract Price shall be subject to an upward or downward adjustment by Change
Order to account for currency fluctuations between the Euro and the U.S. Dollar
as set forth in Section 2 of Attachment EE for the marine loading arms (the
“Marine Loading Arm Adjustment”).

 

G.                                     BOG Compressor Adjustment.  On the date Owner issues the NTP, the
Contract Price shall be subject to an upward or downward adjustment by Change
Order to account for currency fluctuations between the Yen and the U.S. Dollar
as set forth in Section 2 Attachment EE for the Boil-Off gas compressor (the
“BOG Compressor Adjustment”).

 

H.                                    Reimbursable Scope of Work Items.  Until such time as the Parties otherwise
mutually agree to a lump sum Change Order, Owner shall be invoiced by
Contractor for Work performed in connection with the following items (other
than the development of such Change Order) on the basis of Reimbursable Costs
in accordance with the procedures set forth in, and to the extent provided
under, Section 13 of Attachment A:

 

1.                                       Submerged
combustion vaporizers;

 

2.                                       High
pressure sendout compressor;

 

3.                                       Requirements
issued by the FERC after June 1, 2004;

 

4.                                       Requirements
issued by the LDEQ after March 1, 2004; and

 

5.                                       Requirements
issued by the USACE after June 1, 2004.

 

In the event the Parties mutually agree to a lump sum
Change Order, the Contract Price shall be subject to an adjustment in
accordance with Section 13 of Attachment A.  In addition, the Project Schedule may be
adjusted for items 3, 4 or 5 above, but only to the extent that such items 3, 4
or 5 adversely affects Contractor’s ability to perform the Work in accordance
with the Project Schedule, provided that Contractor
complies with the requirements set forth in Sections 6.2, 6.5 and 6.9.

 

7.2                                 Interim Payments.

 

A.                                   Advance Payment.  On or before and as a condition precedent to
the issuance of the Notice to Proceed in accordance with Section 5.2B and upon
Owner’s receipt of an Invoice from Contractor, Owner shall pay Contractor a
lump sum equal to five percent (5%) of the Contract Price (the “Advance Payment”).

 

B.                                     Payments.  Subject to Section 5.2A, with the exception
of the Advance Payment, payments shall be made by Owner to Contractor in
accordance with the Payment Schedule set forth in Attachment C (as may
be amended by Change Order), which allocates

 

51

 

seventy percent (70%) of the Contract Price to be paid
based on completion of the Milestones set forth in Attachment C, Schedule
C-1, and (ii) thirty percent (30%) to be paid based on the Monthly payments
set forth in Attachment C, Schedule C-2 (the “Monthly Payments”), as adjusted
pursuant to Section 7.2F.  Owner shall
also make payments to Contractor in accordance with the Reimbursable Costs
where so specified in this Agreement and for any unilateral Change Orders
issued in accordance with Section 6.1C. 
Each payment shall be subject to Owner’s right to withhold payments
under this Agreement as set forth in Section 7.5 and Section 20.3.  Payments shall be made in U.S. Dollars to an
account designated by Contractor.  The
Payment Schedule, including Milestones and Monthly Payments, shall be amended
only by Change Order pursuant to this Agreement.

 

C.                                     Invoices.  Within ten (10) Days after the end of each
Month, Contractor shall submit to Owner an Invoice for all Milestones completed
up to the date of the Invoice,  if any,
and the Monthly Payment, which Invoice shall be in the amount equal to the
payment due for such completed Milestones and Monthly Payment.  Contractor shall not be entitled to any
payment whatsoever for any portion of the Work (except for the Monthly
Payments) relating to a particular Milestone until such Milestone is
completed.  Such Monthly Invoice shall
also include amounts properly due and owing for Work performed during the prior
Month and pursuant to a unilateral Change Order issued pursuant to Section 6.1C
or 6.2D, and for other Reimbursable Costs. 
All Invoices, other than the Invoice for final payment under this
Agreement, shall be in the form of Schedule I-1.  Within ten (10) Days after the end of each
Month, Contractor shall submit to Owner a Monthly Progress Report, the receipt
of which shall be a condition of payment under this Article 7.

 

D.                                    Interim Lien Waivers.  As a condition of payment, each Invoice
received by Owner prior to Final Completion shall be accompanied by a fully
executed (i) Interim Conditional Lien Waiver from Contractor in the form of Schedule
K-1 for all Work performed through the date of the Invoice for which
payment is requested and (ii) Interim Unconditional Lien Waiver from Contractor
in the form of Schedule K-2 for all Work performed through the date of
the last Invoice submitted by Contractor. 
In addition, as a condition of payment, Contractor shall also provide
(i) fully executed Interim Conditional Lien Waivers in the form of Schedule K-3
from each Major Subcontractor whose invoice is received by Contractor in the
Month covered by Contractor’s Invoice (with each such Interim Conditional Lien
Waiver covering all Work performed by each such Major Subcontractor through the
date of such Major Subcontractor’s invoice), together with fully executed
Interim Unconditional Lien Waivers from each Major Subcontractor for all Work
performed by such Major Subcontractor through the date of each such Major
Subcontractor’s preceding invoice; (ii) fully executed Interim Conditional Lien
Waivers in substantially the form of Schedule K-3 from each Major
Sub-subcontractor whose invoice is received by Contractor in the Month covered
by Contractor’s Invoice (with each such Interim Conditional Lien Waiver covering
all Work performed by each such Major Sub-subcontractor through the date of
such Major Sub-subcontractor’s invoice), together with fully executed Interim
Unconditional Lien Waivers from each Major Sub-subcontractor in substantially
the form set forth in Schedule K-4 for all Work performed by such Major
Sub-subcontractor through the date of each such Major

 

52

 

Sub-subcontractor’s preceding invoice; provided that if Contractor fails to provide to Owner an Interim
Conditional Lien Waiver or Interim Unconditional Lien Waiver from a Major
Subcontractor or Major Sub-subcontractor as required in this Section 7.2D,
Owner’s right to withhold payment for the failure to provide any such Interim
Conditional Lien Waiver or Interim Unconditional Lien Waiver shall be limited
to the amount that should have been reflected in such Interim Conditional Lien
Waiver or Interim Unconditional Lien Waiver.

 

E.                                      Review and Payment.  Each Invoice shall be reviewed by Owner and,
upon Owner’s reasonable request, Contractor shall furnish such supporting
documentation and certificates and provide such further information as may be
reasonably requested by Owner.  Within
fifteen (15) Days after receipt of any Invoice, Owner shall provide notice to
Contractor of any disputed amount set forth in such Invoice, including an
explanation of why such amount is disputed. 
Unless so disputed by Owner, each Invoice (less any withholdings allowed
under this Agreement) shall be due and paid no later than twenty-five (25) Days
after it, and all applicable documentation required under Attachment I,
is received by Owner.  If an Invoice is
disputed by Owner, then payment shall be made within the twenty-five (25) Day
period for all undisputed amounts and the dispute shall be resolved pursuant to
Article 18. Payment on disputed
amounts shall be made as soon as such dispute is resolved.

 

F.                                      Reconciliation of Monthly Payments.  If at any time during the course of the
Project: (i) the Monthly Progress Reports show that any activity on the
critical path is ninety (90) Days or more behind schedule; and (ii) Contractor
or any of its Subcontractors or Sub-subcontractors are not excused under the
terms of this Agreement for such delay, then the date for payment of the last
Monthly Payment as shown in the Payment Schedule shall be revised to a later
date according to the number of Days that the activity is behind schedule and
the remaining Monthly Payments not yet disbursed to Contractor under this
Agreement shall be readjusted and spread out proportionately through the
remainder of the period, ending upon the revised date for payment of the last
Monthly Payment; provided that, in the event that
Contractor recovers the delay such that the activity in question ceases to be behind
schedule, the Monthly Payments shall be recalculated so that such Monthly
Payments shall be due in accordance with the original Payment Schedule as of
the Contract Date.

 

7.3                                 Final Completion and Final Payment.  Upon Final Completion, Contractor shall, in
addition to any other requirements in this Agreement for achieving Final
Completion, including those requirements set forth in Section 1.1 for the
definition of Final Completion, submit a fully executed final Invoice in the
form attached hereto as Schedule I-2, along with (i) a statement
summarizing and reconciling all previous Invoices, payments and Change Orders;
(ii) an affidavit that all payrolls, Taxes, bills for Equipment, and any other
indebtedness connected with the Work for which Contractor and its
Subcontractors and Sub-subcontractors are liable (excluding Corrective Work)
have been paid; (iii) fully executed Final Conditional Lien and Claim Waiver
from Contractor in the form of Schedule K-5, (iv) fully executed Final Conditional
Lien and Claim Waivers from each Major Subcontractor in the form set forth in Schedule
K-7; and (v) fully executed Final Conditional Lien and Claim Waivers from
each Major Sub-subcontractor in substantially the form set forth in Schedule
K-7.  No later than twenty-five (25)
Days after receipt

 

53

 

by Owner of such final Invoice and all reasonably requested
documentation and achieving Final Completion, Owner shall, subject to its
rights to withhold payment under this Agreement, pay Contractor the balance of
the Contract Price, provided that Contractor
provides to Owner at or before the time of such payment the following: (x)
fully executed Final Unconditional Lien and Claim Waiver from Contractor in the
form of Schedule K-6; and (y) fully executed Final Unconditional Lien
and Claim Waivers from each Major Subcontractor and Major Sub-subcontractor in
substantially the form of Schedule K-8; provided
that the Parties agree that “substantially” means that the same
protections shall be provided to Owner as set forth in Schedule K-8.

 

7.4                                 Payments Not Acceptance of Work.  No payment made hereunder by Owner shall be
considered as approval or acceptance of any Work by Owner or a waiver of any
claim or right Owner may have hereunder.  All payments shall be subject to correction in
subsequent payments.

 

7.5                                 Payments Withheld.  In
addition to disputed amounts set forth in an Invoice, Owner may, in addition to
any other rights under this Agreement, and upon giving Contractor ten (10) Days’
prior written notice referenced in Section 7.8, withhold payment on an Invoice
or a portion thereof, or collect on the Letter of Credit, in an amount and to
such extent as may be reasonably necessary to protect Owner from loss due to:

 

A.                                   Defective
Work, unless Contractor has, within fourteen (14) Days of a separate written
notice given prior to the ten (10) Day notice referenced in Section 7.8, either
(i) remedied such Defective Work or (ii) if such Defective Work cannot be
remedied by the exercise of reasonable diligence within such fourteen (14) Day
period, provided Owner with a written plan, reasonably acceptable to Owner, to
remedy such Defective Work and commenced the remedy of such Defective Work;

 

B.                                     liens
or other encumbrances on all or a portion of the Site, the Work or the
Facility, which are filed by any Subcontractor, any Sub-subcontractor or any
other Person acting through or under any of them unless Contractor has, within
fourteen (14) Days of a separate written notice given prior to the ten (10) Day
notice referenced in Section 7.8, taken any of the following actions: (i) paid,
satisfied or discharged the applicable liability, (ii) removed the lien or
other encumbrance, or (iii) provided Owner with a bank guarantee or bond
reasonably satisfactory to Owner and Lender in the applicable amount;

 

C.                                     any
material breach by Contractor of any term or provision of this Agreement;
unless Contractor has, within fourteen (14) Days of a separate written notice
given prior to the ten (10) Day notice referenced in Section 7.8, either (i)
cured such breach or (ii) if such breach cannot be cured by the exercise of
reasonable diligence within such fourteen (14) Day period, Contractor has
commenced corrective action and is diligently exercising all commercially practicable
efforts to cure such breach;

 

D.                                    the
assessment of any fines or penalties against Owner as a result of Contractor’s
failure to comply with Applicable Law or Applicable Codes and Standards;

 

E.                                      amounts
paid by Owner to Contractor in a preceding Month incorrectly;

 

54

 

F.                                      Liquidated
Damages which Contractor owes under the terms of this Agreement; or

 

G.                                     any
other costs or liabilities which Owner has incurred for which Contractor is
responsible under this Agreement.

 

Owner shall pay
Contractor the amount withheld or collected on the Letter of Credit as soon as
practicable, but in no event later than fifteen (15) Business Days after Owner’s
receipt of an Invoice from Contractor, if Contractor, as appropriate, (i) pays,
satisfies or discharges the applicable liability and provides Owner with
reasonable evidence of such payment, satisfaction or discharge, (ii) removes
the lien or other encumbrance, (iii) cures the breach in question, (iv)
remedies the Defective Work in question, or (v) provides Owner with a bank
guarantee or bond reasonably satisfactory to Owner and Lender in the amount of
the withheld payment.

 

7.6                                 Interest on Late Payments and Improper Collection.  Any amounts due but not paid hereunder, any
amounts withheld from Contractor but later finally determined in accordance
with the dispute resolution procedure set forth in Article 18 to have been improperly withheld, or any amounts
collected by Owner on the Letter of Credit but later finally determined in
accordance with the dispute resolution procedure set forth in Article 18 to have been improperly
collected, shall bear interest at the lesser of (i) an annual rate equal to the
prime rate set from time to time by Citibank, N.A. plus three percent (3%), or
(ii) the maximum rate permitted under Applicable Law.

 

7.7                                 Offset.  Owner may, in
accordance with Section 7.8B, offset any amount due and payable from Contractor
to Owner under this Agreement against any amount due and payable to Contractor
hereunder.

 

7.8                                 Procedure for Withholding, Offset and Collection on the Letter of
Credit.  Except as provided in
Sections 16.1B and 20.3C (in which case, Owner shall follow the procedure set
forth in Section 16.1B or Section 20.3C, as applicable), Owner shall:

 

A.                                   prior
to exercising its right to withhold payment in accordance with this Agreement,
provide Contractor with ten (10) Days’ written notice stating Owner’s intent to
withhold and the amount to be withheld;

 

B.                                     prior
to exercising its right to offset in accordance with this Agreement, provide
Contractor with ten (10) Days’ prior written notice stating Owner’s intent to
offset and the amount to be offset; and

 

C.                                     prior
to exercising its right to collect on the Letter of Credit in accordance with
this Agreement, provide Contractor with ten (10) Days’ written notice (i)
specifying the nature of Contractor’s breach and the liabilities, damages,
losses, costs or expenses owed to Owner; (ii) stating Owner’s intent to draw
against the Letter of Credit; and (iii) specifying the amount to be drawn.

 

Notwithstanding
the foregoing, should any payment under any Invoice become due before the
expiration of any notice period specified in this Section 7.8, Owner shall
nevertheless be entitled to withhold from such Invoice amounts equal to the
amounts specified in

 

55

 

Owner’s notice, but Owner
shall promptly pay such withheld amounts to Contractor if Contractor cures the
cause for such withholding or offset.

 

7.9                                 Payment Error.  If an
error is made in connection with a payment, and such payment is an overpayment,
the Party receiving the payment in error shall immediately refund the mistaken
amount to the paying Party.  Without
limiting the preceding sentence, and in addition to any other remedy available
to Owner under this Agreement, if Owner discovers that any amount paid by it to
Contractor in a preceding Month was incorrect, then Owner may, at its sole
discretion, upon giving Contractor ten (10) Days’ prior written notice in
accordance with Section 7.8, either: (i) offset such amount against future
payments, or (ii) in the event that (A) the amount in question exceeds Three
Million U.S. Dollars (U.S.$3,000,000) or (B) less than Three Million U.S.
Dollars (U.S.$3,000,000) remains payable to Contractor under this Agreement, or
amounts are due to Owner in connection with the final Invoice issued in
accordance with Section 7.3, collect on the Letter of Credit for such amounts
until sufficient and accurate supporting information is provided pursuant to
Section 7.2.  The foregoing provision
shall not apply during the Defect Correction Period.

 

Article 8

TITLE AND RISK OF LOSS

 

8.1                                 Title.

 

A.                                   Clear Title.

 

1.                                       Contractor
warrants and guarantees that Owner shall have legal title to and ownership of all
or any portion of the Work (other than Work Product) and the Facility upon
payment therefor.

 

2.                                       Contractor
warrants and guarantees that legal title to and ownership of the Work and the
Facility shall be free and clear of any and all liens, claims, security
interests or other encumbrances arising out of the Work when title thereto
passes to Owner, and if any such warranty or guarantee is breached, Contractor
shall have the liability and obligations set forth in Section 17.5.

 

B.                                     Title to Work.  Title to all or any portion of the Work
(other than Work Product) shall pass to Owner upon payment by Owner
therefor.  Transfer of title to Work
shall be without prejudice to Owner’s right to reject Defective Work, or any
other right in this Agreement.

 

8.2                                 Risk of Loss.

 

A.                                   Notwithstanding
passage of title as provided in Section 8.1 of this Agreement, Contractor shall
bear the risk of physical loss and damage with respect to the Facility and the
Work until the earlier of Substantial Completion or termination of this
Agreement; provided that Owner shall at all times
bear the risk of physical loss and damage if and to the extent arising from (i)
war (whether declared or undeclared), civil
war, act of terrorism, sabotage, blockade, insurrection; or (ii) ionizing
radiation, or contamination by radioactivity
from nuclear fuel, or from any nuclear waste from the

 

56

 

combustion of nuclear fuel
properties of any explosive nuclear assembly or nuclear component thereof.   In the event that any physical loss or
damage to the Facility or the Work arises from one or more of the events set
forth in the preceding sentence, and Owner elects to rebuild such physical loss
or damage, Contractor shall be entitled to a Change Order to the extent such
event adversely affects (i) Contractor’s costs of performance of the
Work; (ii) Contractor’s ability to perform the Work in accordance with the
Project Schedule or (iii) Contractor’s ability to perform any material
obligation under this Agreement; provided that
Contractor complies with the requirements set forth in Sections 6.2, 6.5 and 6.9.

 

B.                                     Upon
and from the occurrence of Substantial Completion, Owner shall assume care,
custody and control of the Facility and shall bear the full risk of physical
loss and damage to the Work and the Facility; provided,
however, notwithstanding the foregoing, Contractor shall remain
fully responsible and liable to Owner for its Warranty and Corrective Work
obligations under this Agreement.

 

Article 9

INSURANCE AND LETTER OF CREDIT

 

9.1                                 Insurance.

 

A.                                   Provision of Insurance.  The Parties shall provide the insurance as
specified in Attachment O on terms and conditions stated therein.

 

B.                                     No Cancellation.  All policies providing coverage hereunder
shall contain a provision that at least thirty (30) Days’ prior written notice
shall be given to the non-procuring Parties and additional insureds prior to
cancellation, non-renewal or material change in the coverage.

 

C.                                     Obligations Not Relieved.  Anything in this Agreement to the contrary
notwithstanding, the occurrence of any of the following shall in no way relieve
Contractor from any of its obligations under this Agreement: (i) failure by
Contractor to secure or maintain the insurance coverage required hereunder;
(ii) failure by Contractor to comply fully with any of the insurance provisions
of this Agreement; (iii) failure by Contractor to secure such endorsements on
the policies as may be necessary to carry out the terms and provisions of this
Agreement; (iv) the insolvency, bankruptcy or failure of any insurance company
providing insurance to Contractor; or (v) failure of any insurance company to
pay any claim accruing under its policy.

 

D.                                    Failure to Provide Insurance.  If any Party fails to provide or maintain
insurance as required herein, and fails to cure such failure within fourteen
(14) Days of receiving notice of such failure (provided
that such fourteen (14) Day cure period falls within the applicable
sixty (60) Day notice period required under Section 2 of Attachment O), the
other Party shall have the right but not the obligation to purchase such
insurance and shall be entitled to recover the insurance premium reasonably paid
in respect of such insurance from the other Party in accordance with this
Agreement; provided that, prior to execution of a
Change Order in accordance with Section 7.1B for any additional amounts

 

57

 

owed for the Project Insurances, Owner
shall not be entitled to recover from Contractor any insurance premiums paid by
Owner with respect to any amounts in excess of the Insurance Allowance for
Project Insurances.

 

E.                                      Unavailable Insurance.  If any insurance (including the limits or
deductibles thereof) hereby required to be maintained, other than insurance
required by Applicable Law to be maintained, shall not be reasonably available
in the commercial insurance market, Owner and Contractor shall not unreasonably
withhold their agreement to waive such requirement to the extent that maintenance
thereof is not so available; provided, however,
that the Party shall first request any such waiver in writing from the other
Party, which request shall be accompanied by written reports prepared by two
(2) independent advisers, including insurance brokers, of recognized
international standing certifying that such insurance is not reasonably
available in the commercial insurance market (and, in any case where the
required amount is not so available, explaining in detail the basis for such
conclusions), such insurance advisers and the form and substance of such
reports to be reasonably acceptable to the other Party.  Any such waiver shall be effective only so
long as such insurance shall not be available and commercially feasible in the
commercial insurance market.

 

9.2                                 Irrevocable Standby Letter of Credit.  On or before the issuance of the Notice to
Proceed in accordance with Section 5.2B, Contractor
shall deliver to Owner the following: (i) an irrevocable standby letter of
credit in the amount of ten percent (10%) of the Contract Price (“Performance Letter of Credit”) and
(ii) an irrevocable standby letter of credit in the amount of five percent (5%)
of the Contract Price (“Payment Letter of Credit”).  As used herein, “Letter
of Credit” shall mean, as applicable, either the Performance
Letter of Credit or the Payment Letter of Credit.  Each Letter of Credit shall name Owner as
beneficiary, shall be in the relevant form set forth in Attachment R,
and shall be issued and confirmed by a commercial bank in the United States of
America with a long-term rating of at least A- by Standard & Poor’s and at
least A3 by Moody’s Investors Service. 
If at any time the rating of the commercial bank that issued the
applicable Letter of Credit falls below either of such ratings, Contractor
shall replace such Letter of Credit within ten (10) Days with an equivalent
instrument issued by a commercial bank in the United States of America meeting
such rating requirements.  Owner shall have
the right to draw down on or collect against either Letter of Credit upon Owner’s
demand in the event of the following: (i) the owing by Contractor to Owner
under this Agreement for Liquidated Damages or any other liabilities, damages,
losses, costs or expenses for which Contractor is liable under this Agreement;
and (ii) Owner has provided notice to Contractor in accordance with Section 7.8C,
except such notice is not required where Contractor does not pay Liquidated
Damages as set forth in Section 20.3C. 
The amount drawn on a Letter of Credit shall not be greater than the
amount that Owner, at the time of the drawing, reasonably estimates is owed it
under this Agreement for Liquidated Damages, liabilities, damages, losses,
costs or expenses or is necessary to remedy the breach of this Agreement.  In addition, should the issuing commercial
bank notify Owner and Contractor pursuant to the terms of either Letter of
Credit that it has decided not to extend the applicable Letter of Credit beyond
the then current expiration date, Owner shall also have the right to draw down
on or collect against the applicable Letter of Credit for all remaining funds
available under such Letter of Credit upon Owner’s demand if Contractor has
not, prior to thirty (30) Days before the then current expiration date, delivered
to Owner a replacement letter of credit substantially identical to the
applicable Letter of Credit and from a commercial bank meeting the

 

58

 

requirements in
this Section 9.2.  The amount of the Performance
Letter of Credit shall decrease to an aggregate amount of five percent (5%) of
the Contract Price thirty (30) Days after the issuing commercial bank’s receipt
from Owner of (i) a copy of the Substantial Completion Certificate signed by
Contractor and (ii) a copy of the Substantial Completion Certificate signed by
Owner showing that Owner accepts the Substantial Completion Certificate.  No later than thirty (30) Days after Owner’s
acceptance of the Substantial Completion Certificate, Owner shall provide the
commercial bank that issued the applicable Letter of Credit with written notice
of such acceptance.  The Performance
Letter of Credit shall remain in full force and effect from the issuance of
such Performance Letter of Credit through the expiration of the Defect
Correction Period, at which time the Performance Letter of Credit will be
returned to Contractor.  No later than
fourteen (14) Days following the expiration of the Defect Correction Period,
Owner shall provide the commercial bank that issued the Performance Letter of
Credit with written notice of the expiration of the Defect Correction
Period.  Partial drawings are permitted
under each Letter of Credit.  The amount of the Payment Letter of Credit shall be
reduced to zero, on a pro-rata basis, in equal monthly amounts, commencing with
the Month immediately following issuance of the NTP and concluding eleven (11)
Months thereafter.  In the event the Contract Price is increased by one
or more Change Orders in accordance with the terms of this Agreement, by a
cumulative amount of Ten Million U.S. Dollars (U.S.$10,000,000) or more,
Contractor shall, upon Owner’s request, increase the amount of the Letter of
Credit to reflect the corresponding increase in such Contract Price.  Such increase in the Letter of Credit shall
be reflected in a Change Order mutually agreed upon by the Parties.

 

9.3                                 Bechtel General Corporate Facts and Contractor Quarterly Confirmation.  As soon as available to Contractor after the
end of each fiscal year of Contractor, but in no event later than one hundred
and fifty (150) Days after the end of each such fiscal year, Contractor shall
deliver to Owner the unaudited report titled “Bechtel Corporation Consolidated
General Facts” (the “Bechtel
General Corporate Facts”) and a copy of the letter from
Contractor’s auditor to Contractor confirming that the Bechtel General
Corporate Facts is fairly stated in all material respects in relation to
Contractor’s audited financial statements from which it was derived.  In addition, within thirty (30) Days after
the end of each fiscal quarter of Contractor, Contractor shall deliver to Owner
a statement in the form of Schedule BB-1 (“Contractor Quarterly Confirmation”).  Such Contractor Quarterly Confirmation shall
be signed by an appropriate senior officer of Contractor.  The Bechtel General Corporate Facts delivered
pursuant to this Section 9.3 shall be complete and correct in all material
respects and shall be prepared in accordance with GAAP applied consistently
throughout the periods reflected therein. Owner acknowledges the confidential
and business sensitive nature of each Bechtel General Corporate Facts and
Contractor Quarterly Confirmation.  Owner
agrees that it shall keep such documents confidential and that it shall not
disclose, or permit the disclosure of, any such document to any other Person
under any circumstances, without Contractor’s prior written consent.  Contractor hereby confirms its consent to the
release of such documents to the Lenders; provided that
such Lenders agree in writing to keep such documents confidential.

 

59

 

Article 10

OWNERSHIP OF DOCUMENTATION

 

10.1                           Work Product, Contractor’s Intellectual Property and Third Party
Proprietary Work Product

 

A.                                   Ownership of Work Product. Owner and Contractor acknowledge that during the course
of, and as a result of, the performance of the Work and prior work related to
the Facility done by Contractor for Owner under the Memorandum of Understanding
or the Technical Services Agreement, Contractor or its Subcontractors or
Sub-subcontractors will create, or have created, for this Project and will
deliver, or have delivered, to Owner, certain written materials, plans,
Drawings (including P&IDs), Specifications, or other tangible results of
performance of the Work under this Agreement or performance of work under the
Memorandum of Understanding or the Technical Services Agreement (hereinafter
individually or collectively referred to as “Work
Product”).  Subject to
this Section 10.1, Owner shall own all rights, title and interest to the Work
Product and any and all intellectual property rights in the Work Product
(including all patents and applications therefor, all inventions, trade
secrets, know-how, technology, technical data, customer lists, copyrights and
all registrations and applications therefor, and all industrial designs)
irrespective of any copyright notices or confidentiality legends to the
contrary which may have been placed in or on such Work Product by Contractor, a
Subcontractor, Sub-subcontractor or any other Person.  Notwithstanding the foregoing, Contractor
shall retain ownership of all intellectual property rights previously owned by
Contractor or developed by it outside this Agreement, the Memorandum of
Understanding or the Technical Services Agreement (hereinafter referred to as “Contractor’s Intellectual Property”),
regardless of whether such Contractor’s Intellectual Property is embedded in
the Work Product, and nothing in this Agreement shall result in a transfer of
ownership of either Contractor’s Intellectual Property or the intellectual
property rights previously owned or developed by Contractor’s Subcontractors or
Sub-subcontractors outside this Agreement, the Memorandum of Understanding or
the Technical Services Agreement (“Third Party Proprietary
Work Product”).

 

B.                                     Use of the Work Product, Contractor’s Intellectual
Property and Third Party Proprietary Work Product. Owner shall be entitled to use the
Work Product and Contractor hereby grants Owner an irrevocable and royalty-free
license to use and (subject to Section 10.1C) modify Contractor’s Intellectual
Property and Third Party Proprietary Work Product which in either case is
embedded in the Work Product relating to the Facility, in each case solely for
the purpose of: (i) operating and maintaining the Facility, (ii) training
operators for the Facility; and (iii) repairing, replacing, expanding,
completing or modifying any part of the Facility.  Owner shall be entitled to assign its rights
in the Work Product and in such license; provided that
such assignee shall only be entitled to use the Work Product and Contractor’s
Intellectual Property and Third Party Proprietary Work Product which is
embedded in the Work Product for the purposes specified in clauses (i) through
(iii) above.

 

C.                                     Modification of Work Product or Contractor’s
Intellectual Property. In addition, Owner or its contractors
shall be entitled to modify (a) the Work Product or (b) Contractor’s
Intellectual Property embedded in the Work Product in connection with the
purposes set forth in clauses (i) through (iii) in Section 10.1B; provided that Owner shall first remove, or cause to be
removed, all references to Contractor from the Work Product and Contractor’s
Intellectual Property embedded in the Work Product.  OWNER
SHALL DEFEND, INDEMNIFY AND HOLD THE CONTRACTOR GROUP HARMLESS FROM AND AGAINST
ALL DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’

 

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FEES AND LITIGATION OR
ARBITRATION EXPENSES) INCURRED BY ANY MEMBER OF THE CONTRACTOR GROUP AND CAUSED
BY ANY MODIFICATIONS TO THE WORK PRODUCT OR CONTRACTOR’S INTELLECTUAL PROPERTY.

 

D.                                    Cheniere’s Use of the Work Product and Contractor’s
Intellectual Property for Other Projects.  In addition, and subject to Cheniere agreeing
to the indemnity provision as set out below, Cheniere shall be entitled to use
the Work Product and Contractor hereby grants solely to Cheniere an irrevocable
and royalty-free license, non-transferable and non-assignable (except as set
forth below) to use Contractor’s Intellectual Property embedded in the Work
Product, in each case solely for the purpose of developing other projects
majority-owned by Cheniere, including the Corpus Christi and Creole Trail projects,
provided that (i) Cheniere shall first remove
all references to Contractor and the Project from the Work Product and Contractor’s
Intellectual Property embedded in the Work Product, (ii) the use of any of
Contractor’s Intellectual Property on such other projects shall be limited to
such Contractor’s Intellectual Property which is embedded in the Work Product;
and (iii) Cheniere shall not assign (except to an Affiliate of Cheniere) such Work
Product or license without Contractor’s consent, which consent shall not be
unreasonably withheld. CHENIERE SHALL
DEFEND, INDEMNIFY AND HOLD THE CONTRACTOR GROUP HARMLESS FROM AND AGAINST ALL
DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES
AND LITIGATION OR ARBITRATION EXPENSES) INCURRED BY ANY MEMBER OF THE
CONTRACTOR GROUP AND CAUSED BY USE OF THE WORK PRODUCT OR CONTRACTOR’S
INTELLECTUAL PROPERTY IN CONNECTION WITH PROJECTS OTHER THAN THE PROJECT WHICH
IS THE SUBJECT OF THIS AGREEMENT.

 

E.                                      Identification of Third Party Proprietary Work
Product.  Contractor shall identify which
portions of the Work Product contain Third Party Proprietary Work Product for
which Cheniere shall need to obtain permission from the appropriate owners of
such Third Party Proprietary Work Product for use by Cheniere on projects other
than the Project.  Notwithstanding
anything to the contrary in this Agreement, no license is granted to Owner with
respect to the use of any Contractor proprietary software or systems.

 

10.2                           Return/Delivery of Certain Property.  All Work Product, and all copies thereof,
shall be returned or delivered to Owner upon the earlier of expiration of the
Defect Correction Period and
termination of this Agreement, except that (i) Contractor may, subject to its
confidentiality obligations set forth in Article 19, retain one record set of
the Work Product and may use and modify such Work Product in accordance with
Section 10.3, and (ii) Contractor’s Subcontractors and Sub-subcontractors may
retain any Work Product generated by them so long as Owner has been provided
the following copies of such Work Product: six (6) hard copies; two (2)
reproducible Drawings, where applicable; and two (2) sets each of fully
editable and operable native and .pdf files of documents on CD for all such
Drawings and Specifications.

 

10.3                           Contractor’s Right to Use of Work Product.  With the exception of any granted United
States patents owned, or pending patents filed by, Owner or any of Owner’s
Affiliates, Owner hereby grants Contractor an irrevocable and royalty-free
license to use and modify the Work Product for any other project, provided that Contractor removes from the Work Product any
reference to the Project or Owner.

 

61

 

10.4                           Owner Provided Documents. 
All written materials, plans, drafts, specifications, computer files or
other documents (if any) prepared or furnished by Owner or any of Owner’s other
consultants or contractors shall at all times remain the property of Owner, and
Contractor shall not make use of any such documents or other media for any
other project or for any other purpose than as set forth herein.  All such documents and other media, including
all copies thereof, shall be returned to Owner upon the earlier of expiration
of the Defect Correction Period and termination of this Agreement, except that
Contractor may, subject to its confidentiality obligations as set forth in Article 19, retain one record set of
such documents or other media.

 

Article 11

COMPLETION AND PERFORMANCE LIQUIDATED DAMAGES

 

11.1                           Notice of RFCD and Delivery of LNG for Commissioning, Start-Up and
Performance Testing.

 

A.                                   Notice of RFCD.  Without limitation of the foregoing or
any other scheduling requirements contained in this Agreement, Contractor shall
give Owner one hundred twenty (120) Days’ prior written notice of the date on
which it expects to achieve RFCD so that Owner can arrange for the delivery of
an LNG shipment for the Cool Down of System 1. 
Sixty (60) Days after such initial notice, Contractor shall give Owner a
second written notice specifying the date on which Contractor expects to
achieve RFCD.  Owner shall schedule the
LNG shipment to Contractor for the purpose of Contractor achieving Cool Down of
System 1 in accordance with such second written notice.  In the event that Contractor at any time
becomes aware or has reason to believe that its ability to achieve RFCD will be
delayed beyond the date specified in either its first or second written notice
given pursuant to this Section 11.1A, Contractor shall immediately give Owner
written notice of such fact and of the revised date on which Contractor then
expects to achieve RFCD.  Owner shall use
all commercially reasonable efforts to reschedule the delivery of the LNG shipment
so as to accommodate the revised date notified by Contractor.  At such time as the Facility has achieved
RFCD, Contractor shall certify to Owner in the form of Attachment L (“RFCD Completion Certificate”) that
all requirements under this Agreement for RFCD have occurred.  The RFCD Completion Certificate shall be
accompanied by all other supporting documentation as may be required to
establish that the requirements for RFCD have been met.

 

B.                                     Notice of Delivery of LNG for Commissioning,
Start-Up and Performance Testing.  Without limitation of the foregoing or any
other scheduling requirements contained in this Agreement, Contractor shall
give Owner one hundred twenty (120) Days’ prior written notice of the date on
which it expects that it will need LNG beyond that required for RFCD to
commence or continue commissioning, start-up and Performance Testing so that
Owner can arrange for the delivery of an LNG shipment for such commissioning,
start-up and Performance Testing.  Sixty
(60) Days after such initial notice, Contractor shall give Owner a second
written notice specifying the date on which Contractor expects that it will
need such additional LNG to commence or continue commissioning, start-up and
Performance Testing.  Owner shall
schedule the LNG shipment to Contractor for the purpose of Contractor
conducting commissioning, start-up and Performance Testing requiring the use of
LNG beyond that delivered for RFCD in

 

62

 

accordance with such second written notice.  In the event that Contractor at any time
becomes aware or has reason to believe that its ability to use such LNG for
commissioning, start-up and Performance Testing will be delayed beyond the date
specified in either its first or second written notice given pursuant to this
Section 11.1B, Contractor shall immediately give Owner written notice of such
fact and of the revised date on which Contractor then expects that it will need
such LNG for commissioning, start-up and Performance Testing.  Owner shall use all commercially reasonable
efforts to reschedule the delivery of the LNG shipment so as to accommodate the
revised date notified by Contractor.

 

11.2                           Delay in RFCD.   In
the event RFCD is delayed beyond the date specified in the second written notice given by
Contractor to Owner pursuant to Section 11.1A, Owner shall, at Contractor’s
request, hold the LNG shipment for a maximum period of fifteen (15) Days.  After the expiry of such fifteen (15) Day period, Owner, at its election, may either: (i) hold
the LNG shipment until such time as RFCD is achieved, or (ii) turn away such
LNG shipment.  Under either subsection (i) or (ii), Contractor is liable to Owner for
RFCD Delay Liquidated Damages as provided in Section 13.1A, unless such delay
is not caused by Contractor or any of its Subcontractors or Sub-subcontractors
or anyone directly or indirectly employed by them.  In the event Owner turns away the LNG
shipment under subsection (ii) above, Owner shall use all commercially
reasonable efforts to reschedule an LNG shipment as soon as reasonably
practicable.  In the event Owner has failed to use all
commercially reasonable efforts to reschedule the delivery of the LNG shipment
after Owner has turned away an LNG shipment under clause (ii) above and Contractor
has achieved RFCD (or acts or omissions by Owner or an event of Force Majeure
have prevented RFCD from occurring), Contractor shall be entitled to a Change
Order to the extent such failure adversely affects (i) Contractor’s
costs of performance of the Work; (ii) Contractor’s ability to perform the Work
in accordance with the Project Schedule or (iii) Contractor’s ability to
perform any material obligation under this Agreement; provided
that Contractor complies with the requirements set forth, as applicable,
in Sections 6.2, 6.5, 6.8 and 6.9.

 

11.3                           Notice and Requirements for Substantial Completion.  Contractor shall give Owner not less than
ninety (90) Days’ prior written notice of its intention to commence the
Performance Tests, and, on the sixtieth (60th) Day and thirtieth (30th)
Day immediately prior to Contractor’s intention to commence such testing
activities, Contractor shall provide written notices to Owner.  The Parties shall, no later than twenty-four
(24) months after Owner’s issuance of the Notice to Proceed, mutually agree
upon final test procedures for the conduct of the Performance Tests as
specified in and consistent with Attachment S (these test procedures and
the test parameters specified in Attachment S hereinafter referred to as
“Performance Test Procedures”).  Contractor shall provide all labor,
equipment, supplies, and all other items necessary for the conduct of the
Performance Tests; provided, however,
that Owner shall provide operating personnel for supervision by Contractor in
accordance with Section 4.4 and the LNG necessary for Contractor to achieve
Cool Down in accordance with Section 11.1A, and to commence or continue commissioning,
start-up and conduct the Performance Tests in accordance with Section 11.1B.  Contractor shall analyze the data obtained
during all Performance Tests, and ensure that such data reflects the
performance standards required hereunder. 
A complete copy of all raw performance data and a detailed listing of
all testing instrumentation utilized shall be provided to Owner at the
completion of testing.  Upon achieving
all requirements under this Agreement for Substantial Completion, Contractor
shall certify to Owner in the form of

 

63

 

Attachment M
(“Substantial Completion Certificate”)
that all of the requirements under this Agreement for Substantial Completion
have occurred and shall provide with such Substantial Completion Certificate a
Performance Test report and analysis to Owner. 
At a minimum, the Performance Test report shall include (i) the raw
data, (ii) the instrumentation utilized for the Performance Tests, (iii) the
procedures utilized during the Performance Tests, (iv) calculations and
information, and a full explanation concerning same, for adjustments to the
Guarantee Conditions, as and to the extent specified in the Performance Test
Procedures, and (v) any other reasonable supporting information used to
demonstrate that the Work has met the Minimum Acceptance Criteria or
Performance Guarantees, as the case may be. The Substantial Completion
Certificate shall be accompanied by all other supporting documentation as may
be reasonably required to establish that the requirements for Substantial
Completion have been met.

 

11.4                           Owner Acceptance of RFCD and Substantial Completion.

 

A.                                   Owner Acceptance of RFCD.  Owner shall notify Contractor whether it
accepts or rejects the RFCD Completion Certificate within seventy-two (72)
hours following Owner’s receipt thereof. 
All Work shall continue during pendency of Owner’s review.  Acceptance of RFCD (which such acceptance
shall not be unreasonably withheld) shall be evidenced by Owner’s signature on
such RFCD Completion Certificate.  The
date of RFCD shall be based upon, and the date of Owner’s acceptance of RFCD shall
be deemed to have occurred on, the date listed on the RFCD Completion
Certificate; provided that all requirements
under this Agreement for RFCD were achieved on such date listed on the RFCD
Completion Certificate except for the payment of any and all Liquidated Damages
due and owing to Owner and provided further that
the payment to Owner of such Liquidated Damages shall have been made within the
time and in accordance with Section 20.3C in order for RFCD to have occurred on
the date listed in the RFCD Completion Certificate.  If Owner does not agree that RFCD has
occurred, then Owner shall state the basis for its rejection in reasonable
detail in such notice.  If the Parties do
not mutually agree on when and if RFCD has occurred, the Parties shall thereupon
promptly and in good faith confer and make all reasonable efforts to resolve
such issue.  In the event such issue is
not resolved within forty-eight (48) hours of the delivery by Owner of its
notice to Contractor, the Parties shall resolve such dispute in accordance with
Section 18.1A.  Owner’s acceptance of
RFCD shall not relieve Contractor of any of its obligations to perform the Work
in accordance with the requirements of this Agreement.  As used in this Section 11.4A, “unreasonably
withheld” means that Owner fails to accept the RFCD Completion Certificate even
if all of the requirements under this Agreement for the achievement of RFCD
have been achieved.  For the avoidance of
doubt, “unreasonably withheld,” as used in this Section 11.4A, means that Owner
cannot fail to accept the RFCD Completion Certificate if all the requirements
under this Agreement for the achievement of RFCD have been achieved.

 

B.                                     Owner Acceptance of Substantial Completion.  Owner shall notify Contractor whether it
accepts or rejects the Substantial Completion Certificate within ten (10) Days
following Owner’s receipt thereof.  All
Work shall continue during pendency of Owner’s review.  Acceptance of Substantial Completion (which
such acceptance shall not be unreasonably withheld) shall be evidenced by Owner’s
signature on such Substantial Completion Certificate.  The date of Substantial Completion shall be
based upon, and the

 

64

 

date of Owner’s acceptance of Substantial Completion shall
be deemed to have occurred on, the date listed on the Substantial Completion
Certificate, provided that all requirements
under this Agreement for Substantial Completion were achieved on such date
listed on the Substantial Completion Certificate except for the payment of any
and all Liquidated Damages due and owing to Owner and provided
further that the payment to Owner of such Liquidated Damages shall
have been made within the time and in accordance with Section 20.3C in order
for Substantial Completion to have occurred on the date listed in the
Substantial Completion Certificate.  If
Owner does not agree that Substantial Completion has occurred, then Owner shall
state the basis for its rejection in reasonable detail in such notice.  If the Parties do not mutually agree on when
and if Substantial Completion has occurred, the Parties shall thereupon
promptly and in good faith confer and make all reasonable efforts to resolve
such issue.  In the event such issue is not
resolved within ten (10) Days of the delivery by Owner of its notice to
Contractor, the Parties shall resolve such dispute in accordance with Section 18.1A.  Owner’s acceptance of Substantial Completion
shall not relieve Contractor of any of its obligations to perform the Work in
accordance with the requirements of this Agreement.  Notwithstanding anything to the contrary in
this Section, Owner shall not be required to accept the Substantial Completion
Certificate if the requirements under this Agreement for the achievement of
Substantial Completion have not been achieved. 
As used in this Section 11.4B, “unreasonably withheld” means that Owner
fails to accept the Substantial Completion Certificate even if all of the
requirements under this Agreement for the achievement of Substantial Completion
have been achieved.  For the avoidance of
doubt, “unreasonably withheld,” as used in this Section 11.4B, means that Owner
cannot fail to accept the Substantial Completion Certificate if all the
requirements under this Agreement for the achievement of Substantial Completion
have been achieved.

 

11.5                           Performance Liquidated Damages.

 

A.                                   Minimum Acceptance Criteria Achieved.  In the event that, by the Guaranteed
Substantial Completion Date, the Facility fails to achieve one or more of the
Performance Guarantees, as evidenced by the Performance Test results, but meets
all of the Minimum Acceptance Criteria and all other requirements for
Substantial Completion, then Owner shall have the right, upon written notice to
Contractor, to elect one of the following options.

 

(i)                                     Owner
may elect to take care, custody and control of the Facility and Contractor
shall be granted reasonable access to the Facility for a maximum period
terminating on the date occurring one hundred and eighty (180) Days thereafter
(or such later date as the Parties may mutually agree) so that Contractor shall
take corrective actions in order to achieve the outstanding Performance
Guarantee(s) and conduct additional Performance Tests.  If this option is elected by Owner,
Substantial Completion shall be achieved and, Owner shall sign the Substantial
Completion Certificate and Contractor shall only be responsible for the payment
of Delay Liquidated Damages owing up to the date of Substantial Completion,
which shall be paid in accordance with Section 20.3C.  At any time within such one hundred and
eighty (180) Day period (or such later time period as the Parties may mutually
agree), Contractor shall be entitled to cease taking such corrective actions by
giving notice to Owner to that effect and, in that event, Contractor shall pay

 

65

 

Performance
Liquidated Damages to Owner in accordance with Section 20.3C based on the
results of the last Performance Test conducted by Contractor prior to the
issuance of Contractor’s notice. If the outstanding Performance Guarantee(s)
are achieved within such one hundred and eighty (180) Day period (or such later
time period as the Parties may mutually agree), Contractor shall have no
liability for payment of any Performance Liquidated Damages.  If Contractor does not give notice as
provided in this Section 11.5A(i) and Contractor does not achieve the
outstanding Performance Guarantees within such one hundred and eighty (180) Day
period (or such later time period as the Parties may mutually agree),
Contractor shall pay to Owner the applicable Performance Liquidated Damages in
accordance with Section 20.3C based on the
results of the last Performance Test conducted by Contractor.

 

(ii)                                  Owner
may elect to require Contractor to continue to take corrective actions to
achieve such Performance Guarantee(s), and Contractor shall continue to be
liable to Owner for Substantial Completion Delay Liquidated Damages until
Contractor has achieved such Performance Guarantee(s) or exercised its option
as set forth below.  If Owner fails to
exercise either this option (ii) or option (i) above within ten (10) Business Days
of Owner’s receipt of Contractor’s written notice demanding that Owner elect
its option, Owner shall be deemed to have exercised this option (ii).  In the event that Owner exercises, or is
deemed to have exercised, this option (ii), Contractor shall have the right at
its option at any time to cease taking corrective actions to achieve the
Performance Guarantee(s) and turn over care, custody and control of the
Facility to Owner, and in that event Contractor shall, with respect to each
Performance Guarantee not achieved, pay to Owner the applicable Performance
Liquidated Damages for such Performance Guarantee in accordance with Section 20.3C
based on the results of the last Performance Test conducted by Contractor.  Unless Contractor exercises its option as set
out above in this clause (ii), Contractor shall continue to take the corrective
actions required to achieve each Performance Guarantee not achieved. Upon
achievement of such Performance Guarantee or exercise by Contractor of its
option as set out above in this clause (ii) and payment of Performance
Liquidated Damages as provided above in this clause (ii), Substantial Completion
shall be achieved, Owner shall, sign the Substantial Completion Certificate,
Owner shall take care, custody and control of the Facility, and Contractor
shall only be responsible for the payment of Delay Liquidated Damages owing up
to the date of Substantial Completion, which shall be paid in accordance with
Section 20.3C.

 

Unless Contractor has previously exercised its option
under clause (ii) of this Section 11.5A, if the outstanding Performance
Guarantee(s) are not achieved within one hundred and eighty (180) Days after
the Guaranteed Substantial Completion Date (or such later date as the Parties
may mutually agree), then Owner shall take care, custody and control of the
Facility, Substantial Completion shall be achieved, and Contractor shall pay to
Owner the applicable Performance Liquidated Damages in accordance with Section 20.3C
based on the last Performance Test conducted by Contractor with respect to each
Performance Guarantee.  Upon Owner taking
care, custody and control of the Facility, Substantial Completion shall be
achieved, Owner shall sign the Substantial Completion Certificate and
Contractor shall only be responsible for the payment of Delay Liquidated
Damages owing up to the date of Substantial Completion, which shall be paid in
accordance with Section 20.3C. For the period of time that Contractor is taking
corrective

 

66

 

action to achieve the Performance Guarantees pursuant
to clause (ii) of this Section 11.5A, Contractor shall continue to have care,
custody and control of the Facility and Contractor shall operate the Facility
as provided in Section 11.8A.

 

B.                                     Minimum Acceptance Criteria Not Achieved.  In the event that the Facility fails to
achieve all of the Minimum Acceptance Criteria, as evidenced by the Performance
Test results, by the Guaranteed Substantial Completion Date, as such date may
be extended by Change Order as provided herein, then (i) Substantial Completion
shall not occur and (ii) the provisions of Section 13.1B shall apply.  In addition to the foregoing, Contractor
shall attempt for a period of one hundred and eighty (180) Days after the
Guaranteed Substantial Completion Date (“Minimum Acceptance
Criteria Correction Period”) to correct the Work to enable the
Facility to achieve all of the Minimum Acceptance Criteria and otherwise
achieve Substantial Completion.  If the
Facility has not achieved all of the Minimum Acceptance Criteria and
Substantial Completion upon the termination of the Minimum Acceptance Criteria
Correction Period, then Owner shall have, in its sole discretion, the option of
either (i) granting Contractor a second one hundred and eighty (180) Day
Minimum Acceptance Criteria Correction Period under the same terms and
conditions as the first, including the application of Section 13.1B; or
(ii) claiming Contractor Default pursuant to Article 16.  If, on the other hand, the Facility has
achieved all of the Minimum Acceptance Criteria and Substantial Completion
during the Minimum Acceptance Criteria Correction Period (or during the second one
hundred and eighty (180) Day period, should Owner elect that option), then
Contractor shall be liable to Owner for all Delay Liquidated Damages and the
payment of the Performance Liquidated Damages for any Performance Guarantees
not achieved.

 

11.6                           Punchlist.

 

A.                                   Punchlist for RFCD. 
Prior to RFCD, Owner and Contractor shall inspect the
entire Work, and Contractor shall prepare a proposed Punchlist of items
identified as needing to be completed or corrected as a result of such inspection.
Contractor shall promptly provide the proposed Punchlist to Owner for its
review, together with an estimate of the time and cost necessary to complete or
correct each Punchlist item.  Contractor
shall add to the proposed Punchlist any Punchlist items that are identified by
Owner within ten (10) Days after Owner’s receipt of the proposed Punchlist from
Contractor, and Contractor shall initiate measures to complete or correct, as
appropriate, any item on Contractor’s proposed Punchlist (including those items
identified by Owner during Owner’s review) that are not of a Punchlist
nature.  Notwithstanding anything to the
contrary in this Agreement, Contractor and Owner are not required as a
condition of RFCD to agree upon and identify every Punchlist item and include
it on the Punchlist, but Contractor is required to complete as a condition of
RFCD all Work that does not meet the definition of Punchlist as provided in
Section 1.1.  In the event of a dispute
regarding whether a specific item of Work meets the definition of Punchlist
under Section 1.1, the Parties shall resolve such dispute in accordance with
Section 18.1A.  Upon Contractor’s
completion or correction of any items necessary to achieve RFCD, such Punchlist
as modified by any Owner additions, shall govern Contractor’s performance of
the Punchlist items up to Substantial Completion.

 

67

 

B.                                     Punchlist for Substantial Completion.  Upon completion of the Performance Tests and
prior to Substantial Completion, Owner and Contractor shall inspect the entire
Work, and Contractor shall prepare an updated and revised proposed Punchlist of
items identified as needing to be completed or corrected as a result of such
inspection.  Contractor shall promptly
provide the proposed updated, revised Punchlist to Owner for its review,
together with an estimate of the time and cost necessary to complete or correct
each Punchlist item.  Contractor shall
add to the proposed, revised Punchlist any Punchlist items that are identified
by Owner within ten (10) Days after Owner’s receipt of the proposed revised Punchlist
from Contractor, and Contractor shall immediately initiate measures to complete
or correct, as appropriate, any item on Contractor’s proposed, revised
Punchlist (including those items identified by Owner during Owner’s review)
that are not of a Punchlist nature. 
Notwithstanding anything to the contrary in this Agreement, Contractor
and Owner are not required as a condition of Substantial Completion to agree
upon and identify every Punchlist item and include it on the Punchlist, but
Contractor is required to complete as a condition of Substantial Completion all
Work that does not meet the definition of Punchlist as provided in Section 1.1.  In the event of a dispute regarding whether a
specific item of Work meets the definition of Punchlist under Section 1.1, the
Parties shall resolve such dispute in accordance with Section 18.1A.  Owner shall provide Contractor with access to
the Facility after Substantial Completion sufficient to enable Contractor to
complete all Punchlist items, so long as such access does not unreasonably
interfere with operation of the Facility and subject to any reasonable security
or safety requirements of Owner.  Upon
Contractor’s completion or correction of any items necessary to achieve
Substantial Completion, as modified by any Owner additions, such Punchlist
shall govern Contractor’s performance of the Punchlist items up to Final
Completion.  All Work on the Punchlist
shall be completed by the date required for Final Completion, as specified in
Section 5.3B, or Owner may, in addition to any other rights that it may have
under this Agreement, complete such Punchlist Work at the expense of
Contractor.  In the event Owner elects to
complete such Punchlist Work, Contractor shall pay Owner, within ten (10) Days
after receipt of written notice from Owner, all reasonable costs and expenses
incurred by Owner in performing such Punchlist Work, or, at Owner’s sole
discretion, Owner may withhold or offset amounts owed to Contractor or collect
on the Letter of Credit in accordance with Section 7.8 in the amount of such
costs and expenses.  Any Defective Work
identified after agreement between the Parties of the Punchlist shall be
corrected by Contractor as a Warranty item under Article 12.

 

11.7                           Notice and Requirements for Final Completion.  Final Completion shall be achieved when all
requirements for Final Completion set forth in the definition of Final
Completion under Section 1.1 have been satisfied.  Upon Final Completion, Contractor shall
certify to Owner in the form of Attachment N (“Final
Completion Certificate”) that all of such requirements have
occurred.  Owner shall notify Contractor
whether it accepts or rejects the Final Completion Certificate within ten (10)
Days following Owner’s receipt thereof. 
Acceptance of Final Completion (which such acceptance shall not be
unreasonably withheld) shall be evidenced by Owner’s signature on such
certificate, which shall be forwarded to Contractor with such notice. The date
of Final Completion shall be based upon, and the date of Owner’s acceptance of
Final Completion shall be deemed to have occurred on, the date listed on the
Final Completion Certificate; provided that
all requirements under this Agreement for Final Completion were achieved on
such date listed on the Final Completion Certificate.  If Owner does not agree that

 

68

 

Final Completion
has occurred, then Owner shall state the basis for its rejection in such
notice.  If the Parties do not mutually
agree on when and if Final Completion has occurred, the Parties shall thereupon
promptly and in good faith confer and make all reasonable efforts to resolve
such issue.  In the event such issue is
not resolved within ten (10) Days of the delivery by Owner of its notice, the
Parties shall resolve such dispute in accordance with Section 18.1A.  Owner’s acceptance of Final Completion shall
not relieve Contractor of any of its remaining obligations in accordance with
the requirements of this Agreement. 
Notwithstanding anything to the contrary in this Section, Owner shall
not be required to accept the Final Completion Certificate if the requirements
under this Agreement for the achievement of Final Completion have not been
achieved.  As used in this Section 11.7, “unreasonably
withheld” means that Owner fails to accept the Final Completion Certificate
even if all of the requirements under this Agreement for the achievement of
Final Completion have been achieved.  For
the avoidance of doubt, “unreasonably withheld,” as used in this Section 11.7,
means that Owner cannot fail to accept the Final Completion Certificate if all
the requirements under this Agreement for the achievement of Final Completion
have been achieved.

 

11.8                           Operations Activities.

 

A.                                   Operation by Contractor.  Prior
to Substantial Completion and after RFCD, to the extent Contractor has care,
custody and control of the Facility, Contractor shall, to the extent reasonably
possible, operate the Facility in accordance with Owner’s reasonable
instructions and all Permits, including the performance of activities in
connection with (i) the berthing of LNG tankers; (ii) the nomination and delivery of Natural Gas
to delivery points designated by Owner; and (iii) such other activities as
reasonably requested (each, an “Operations Activity”
and, collectively, the “Operations
Activities”).  Contractor
shall not have the obligation to follow Owner’s instructions for any Operations
Activity if such Operations Activity in Contractor’s reasonable opinion has
more than a minimal impact on Contractor’s cost of performance of the Work or
Contractor’s ability to perform the Work in accordance with the Project
Schedule or Contractor’s ability to perform any other obligation under this
Agreement, the intent of this Section 11.8A being that Contractor’s performance
of the Work shall have priority over the operation of the Facility; provided, however, notwithstanding the foregoing, Owner
shall be entitled to direct Contractor to stop, or cause to be stopped, all or
any portion of the Work if the continuance of such Work would, in Owner’s
reasonable opinion, be unsafe or cause damage to the Project or the
Facility.  Within twelve (12) hours of
receipt of Owner’s instructions regarding such Operations Activity, Contractor
shall provide notice to Owner informing Owner whether it can comply with Owner’s
instructions and the reason if it cannot so comply.  Contractor’s performance of the Operations
Activities shall not in any way release Contractor or any surety of Contractor
from any obligations or liabilities pursuant to this Agreement.  Notwithstanding anything to the contrary in
this Section 11.8A, any restrictions concerning Operations Activity shall not
apply to the receipt of any LNG which is required to be delivered by Owner as a
condition of achieving Cool Down of the Facility or the Performance Testing of
the Facility, or the consequent gasification and sendout of any such LNG.

 

B.                                     Operation by Owner.  Upon Owner’s election to take care, custody
and control of the Facility in accordance with Section 11.5, Owner has the
right to operate the Facility.  Owner
shall bear the risk of physical loss and damage to the Work and the

 

69

 

Facility as provided in Article 8.

 

11.9                           Schedule Bonus. In the event Contractor achieves Target
Completion on or before the Target Bonus Date, Contractor shall earn a schedule
bonus in the amount of Twelve Million U.S. Dollars (U.S.$12,000,000) (the “Schedule Bonus”).  If Target Completion is not achieved on or
before the Target Bonus Date, the amount of such Schedule Bonus payable to Contractor
shall be decreased by an amount of Three Hundred Thousand U.S. Dollars (U.S.$300,000)
for each Day which passes after the Target Bonus Date until Target Completion
occurs, down to a Schedule Bonus amount of zero (U.S.$0).  If Contractor earns the Schedule Bonus or any
portion thereof, Contractor shall invoice Owner for the applicable amount of
such Schedule Bonus in the next Invoice cycle under this Agreement, and Owner
shall pay Contractor the applicable amount of such Schedule Bonus within the
time required under this Agreement for making payments of amounts invoiced by
Contractor.  The failure of Contractor to
achieve Target Completion by the Target Bonus Date shall not create a separate liability
for Contractor under this Agreement.

 

Article 12

WARRANTY AND CORRECTION OF WORK

 

12.1                           Warranty.

 

A.                                   General.  The warranties set forth in this Article 12
(collectively, the “Warranty” or “Warranties”) are in addition to any
of the Minimum Acceptance Criteria or Performance Guarantees set forth in this
Agreement.  Any Work, or component
thereof, that is not in conformity with any Warranty is defective (“Defective”) and contains a
defect (“Defect”).

 

B.                                     Warranty of Work.  Contractor hereby warrants that:

 

1.                                       the
Equipment, and each component thereof, shall be new (unless otherwise specified
in this Agreement) and of good quality;

 

2.                                       the
Work (including the Equipment) shall be in accordance with all of the
requirements of this Agreement, including in accordance with GECP, Applicable
Law and Applicable Codes and Standards; and

 

3.                                       the
Work (including the Equipment) shall be free from encumbrances to title, as set
forth in greater detail in Section 8.1.

 

C.                                     Documentation Warranty.  Contractor warrants that the written
instructions regarding the use of Equipment, including those instructions in
operation and maintenance manuals, shall conform to this Agreement and GECP as
of the time such instructions are prepared. 
If any non-conformance with the Warranty specified in this Section 12.1C
occurs or is discovered at any time prior to or during the Defect Correction
Period, Contractor shall, at its sole expense, furnish Owner with corrected
instructions.

 

D.                                    Assignment and Enforcement of Subcontractor
Warranties.  Contractor
shall, without additional cost to Owner, obtain warranties from Subcontractors
that meet or exceed the requirements of this Agreement; provided,
however, Contractor shall not in any

 

70

 

way be relieved of its responsibilities and liability
to Owner under this Agreement, regardless of whether such Subcontractor
warranties meet the requirements of this Agreement, as Contractor shall be
fully responsible and liable to Owner for its Warranty and Corrective Work
obligations and liability under this Agreement for all Work.  All such warranties shall run to the benefit
of Contractor but shall permit Contractor, prior to assignment to Owner, the
right (upon mutual agreement of the Parties), to authorize Owner to deal with
Subcontractor on Contractor’s behalf. 
Such warranties, with duly executed instruments assigning the warranties
shall be delivered to Owner concurrent with the end of the Defect Correction
Period.  This Section 12.1D shall
not in any way be construed to limit Contractor’s liability under this
Agreement for the entire Work or its obligation to enforce Subcontractor
warranties.

 

E.                                      Exceptions to Warranty.  The Warranty excludes remedy, and Contractor
shall have no liability to Owner, for any damage or defect to the extent caused
by: (i) improper repairs or alterations, misuse, neglect or accident by Owner;
(ii) operation, maintenance or use of the Facility, Work or any component
thereof in a manner not in compliance with a material requirement of operation
and maintenance manuals delivered by Contractor to Owner; (iii) normal wear and
tear; (iv) normal corrosion or (v) an event of Force Majeure (but only, with respect
to obligations under Article 12, to the extent such event of Force Majeure
occurs after Substantial Completion).

 

12.2                           Correction of Work Prior to Substantial Completion.

 

A.                                   General Rights.  All Work shall be subject to inspection by
Owner at all reasonable times to determine whether the Work conforms to the
requirements of this Agreement.  Upon
Owner giving reasonable prior notice, Contractor shall furnish Owner with
access to all locations where Work is in progress on the Site and at the
offices of Contractor and its Major Subcontractors.  Owner shall be entitled to provide Contractor
with written notice of any Work which Owner believes does not conform to the
requirements of this Agreement.  If any
Work is Defective, then Contractor shall, at its own expense correct such
Defective Work.  The cost of
disassembling, dismantling or making safe finished Work for the purpose of
inspection, and reassembling such portions (and any delay associated therewith)
shall be borne by (i) Contractor, if such Work is found not to conform with the
requirements of this Agreement and (ii) by Owner, if such Work is found to
conform with the requirements of this Agreement, and Contractor shall be
entitled to a Change Order in such event; provided  that Contractor complies with the requirements set forth in
Sections 6.2 and 6.5.  

 

B.                                     Witness Points.  Contractor shall provide Owner with a list of
witness points for all Major Equipment no later than thirty (30) Days’ after
execution of the relevant Subcontract and Owner shall notify Contractor which
of the witness points it wishes its personnel to witness. Contractor shall
provide Owner with at least fifteen (15) Days prior written notice of the
actual scheduled date of each of the tests Owner has indicated it wishes to
witness.  Contractor shall cooperate with
Owner if Owner elects to witness any additional tests, and Contractor
acknowledges that Owner shall have the right to witness all tests being
performed in connection with the Work.

 

71

 

C.                                     No Obligation to Inspect.  Owner’s right to conduct inspections under
Sections 12.2A and 12.2B shall not obligate Owner to do so.  Neither the exercise of Owner of any such
right, nor any failure on the part of Owner to discover or reject Defective
Work shall be construed to imply an acceptance of such Defective Work or a
waiver of such Defect.  In addition,
Owner’s acceptance of any Work which is later determined to be Defective shall
not in any way relieve Contractor from its obligations under this Article 12.

 

12.3                           Correction of Work After Substantial Completion.  If, during the Defect Correction Period, any
Work or component thereof is found to be Defective, and Owner provides written
notice to Contractor within the Defect Correction Period regarding such Defect,
Contractor shall, at its sole cost and expense, promptly correct (whether by
repair, replacement or otherwise) such Defective Work (the correction of the
Defective Work is hereby defined as the “Corrective Work”).  Any such notice from Owner shall state with
reasonable specificity the date of occurrence or observation of the alleged
Defect and the reasons supporting Owner’s belief that Contractor is responsible
for performing Corrective Work.  Owner
shall provide Contractor with access to the Facility sufficient to perform its
Corrective Work, so long as such access does not unreasonably interfere with
operation of the Facility and subject to any reasonable security or safety
requirements of Owner.  In the event
Contractor utilizes spare parts owned by Owner in the course of performing the
Corrective Work, Contractor shall supply Owner free of charge with new spare
parts equivalent in quality and quantity to all such spare parts used by
Contractor as soon as possible following the utilization of such spare parts.  

 

A.                                   Owner Right to Perform Corrective Work.  If Contractor fails to commence the
Corrective Work within a reasonable period of time not to exceed ten (10)
Business Days, or does not complete such Corrective Work promptly (and provided that Owner provides Contractor access to the
Facility in accordance with Section 12.3), then Owner, upon providing prior
written notice to Contractor, may perform such Corrective Work, and Contractor
shall be liable to Owner for the reasonable costs incurred by Owner in
connection with performing such Corrective Work, and shall pay Owner, within
ten (10) Days after receipt of written notice from Owner, an amount equal to
such costs (or, at Owner’s sole discretion, Owner may withhold or offset amounts
owed to Contractor or collect on the Letter of Credit in accordance with
Section 7.8 in the amount of such costs and expenses); provided,
however, if Defective Work discovered during the Defect Correction
Period presents an imminent threat to the safety or health of any Person and
Owner knows of such Defective Work, Owner may perform such Corrective Work in
order to correct such Defective Work without giving prior written notice to
Contractor.  In such event, Contractor
shall be liable to Owner for the reasonable costs incurred by Owner in
connection with performing such Corrective Work, and shall pay Owner, after
receipt of written notice from Owner, an amount equal to such costs (or, at
Owner’s sole discretion, Owner may withhold or offset amounts owed to
Contractor or collect on the Letter of Credit in accordance with Section 7.8 in
the amount of such costs).  To the extent
any Corrective Work is performed by or on behalf of Owner, Contractor’s
obligations with respect to such Defective Work that is corrected by on or
behalf of Owner shall be relieved, with the exception of Contractor’s
obligation to pay Owner the reasonable costs incurred by Owner in connection
with performing such Corrective Work.

 

72

 

B.                                     Extended Defect Correction Period for Corrective
Work.  With respect to any
Corrective Work performed by Contractor, the Defect Correction Period for such
Corrective Work shall be extended for an additional one (1) year from the date
of the completion of such Corrective Work; provided, however, in no event shall the Defect Correction Period for
any Work (including Corrective Work) extend beyond thirty-six (36) Months after
Contractor’s achievement of Substantial Completion.

 

C.                                     Standards for Corrective Work.  All Corrective Work shall be performed
subject to the same terms and conditions under this Agreement as the original
Work is required to be performed. In connection with the Corrective Work, any
change to Equipment that would alter the requirements of this Agreement may be
made only with prior written approval of Owner in accordance with Section 3.28.

 

D.                                    Expiration of Defect Correction Period.  Contractor shall not be liable to Owner for
any Defective Work discovered after the expiration of the Defect Correction
Period (as may be extended pursuant to Section 12.3B), except for any liability
of Contractor pursuant to its indemnification, defense and hold harmless
obligations under this Agreement.

 

12.4                           Assignability of Warranties. 
The Warranties made in this Agreement shall be for the benefit of Owner
and its successors and permitted assigns and the respective successors and
permitted assigns of any of them, and are fully transferable and assignable.

 

12.5                           Waiver of Implied Warranties.  THE
EXPRESS WARRANTIES SET FORTH IN THIS AGREEMENT (INCLUDING WARRANTIES) ARE
EXCLUSIVE AND THE PARTIES HEREBY DISCLAIM, AND OWNER HEREBY WAIVES ANY AND ALL
WARRANTIES IMPLIED UNDER APPLICABLE LAW (INCLUDING THE GOVERNING LAW SPECIFIED
IN SECTION 21.9), INCLUDING THE IMPLIED WARRANTY OF MERCHANTABILITY AND IMPLIED
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.

 

Article 13

DELAY LIQUIDATED DAMAGES

 

13.1                           Delay Liquidated Damages.

 

A.                                   Delay in RFCD.  If RFCD occurs after the date listed in
Contractor’s second notice given in accordance with Section 11.1A for a reason
attributable to Contractor or any of its Subcontractors or Sub-subcontractors,
Contractor shall pay to Owner the amounts listed in Attachment T per Day
for each Day, or portion thereof, of delay until RFCD occurs (the “RFCD Delay Liquidated Damages”).

 

B.                                     Delay in Substantial Completion.  If Substantial Completion occurs after the
Guaranteed Substantial Completion Date, Contractor shall pay to Owner the
amounts listed in Attachment T per Day for each Day, or portion thereof,
of delay until Substantial Completion occurs (the “Substantial
Completion Delay Liquidated Damages”).

 

C.                                     Delay Liquidated Damages.  The term “Delay
Liquidated Damages” as used in this Agreement means the RFCD
Delay Liquidated Damages and/or the Substantial Completion Delay Liquidated
Damages.

 

73

 

Article 14

CONTRACTOR’S REPRESENTATIONS

 

Contractor represents and
warrants as of the Contract Date that:

 

14.1                           Corporate Standing. 
It is a corporation duly organized, validly existing and in good
standing under the laws of Nevada, is authorized and qualified to do business
in all jurisdictions in which the nature of the business conducted by it makes
such qualification necessary and where failure so to qualify would have a
material adverse effect on its financial condition, operations, prospects,
taxes or business.

 

14.2                           No Violation of Law; Litigation.  It is not in violation of any Applicable Law
or judgment entered by any Governmental Instrumentality, which violations,
individually or in the aggregate, would affect its performance of any
obligations under this Agreement.  There
are no legal or arbitration proceedings or any proceeding by or before any
Governmental Instrumentality, now pending or (to the best knowledge of
Contractor) threatened against Contractor that, if adversely determined, could
reasonably be expected to have a material adverse effect on the financial
condition, operations, prospects or business, as a whole, of Contractor, or its
ability to perform under this Agreement.

 

14.3                           Licenses.  It is the
holder of all licenses required to permit it to operate or conduct its business
in Louisiana now and as contemplated by this Agreement.

 

14.4                           No Breach.  Neither
the execution and delivery of this Agreement, nor the consummation of the
transactions herein contemplated or compliance with the terms and provisions
hereof will conflict with or result in a breach of, or require any consent
under, the charter or by-laws of Contractor, or any Applicable Law or
regulation, or any order, writ, injunction or decree of any court, or any
agreement or instrument to which Contractor is a party or by which it is bound
or to which it or any of its property or assets is subject, or constitute a
default under any such agreement or instrument.

 

14.5                           Corporate Action.  It
has all necessary power and authority to execute, deliver and perform its
obligations under this Agreement; the execution, delivery and performance by
Contractor of this Agreement has been duly authorized by all necessary action
on its part; and this Agreement has been duly and validly executed and
delivered by Contractor and constitutes a legal, valid and binding obligation
of Contractor enforceable in accordance with its terms, except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or moratorium
or other similar laws relating to the enforcement of creditors’ rights
generally.

 

14.6                           Financial Solvency. 
It is financially solvent, able to pay all debts as they mature and
possesses sufficient working capital to complete the Work and perform its
obligations hereunder.

 

Article 15

OWNER’S REPRESENTATIONS

 

Owner represents and
warrants as of the Contract Date that:

 

74

 

15.1                           Standing.  It is a
limited partnership duly organized, validly existing and in good standing under
the laws of Delaware, is qualified to do business in all jurisdictions in which
the nature of the business conducted by it makes such qualification necessary
and where failure so to qualify would have a material adverse effect on its
financial condition, operations, prospects or business.

 

15.2                           No Violation of Law; Litigation.  It is not in violation of any Applicable Law,
or judgment entered by any Governmental Instrumentality, which violations,
individually or in the aggregate, would affect its performance of any
obligations under this Agreement.  There
are no legal or arbitration proceedings or any proceeding by or before any
Governmental Instrumentality, now pending or (to the best knowledge of Owner)
threatened against Owner that, if adversely determined, could reasonably be
expected to have a material adverse effect on the financial condition,
operations, prospects or business, as a whole, of Owner, or its ability to
perform under this Agreement.

 

15.3                           Licenses.  It is the
holder of or will take the necessary action to obtain all Owner Permits under Attachment
Q.

 

15.4                           No Breach.  Neither
the execution and delivery of this Agreement, nor the consummation of the
transactions herein contemplated or compliance with the terms and provisions
hereof and thereof will conflict with or result in a breach of, or require any
consent under, the constituent documents of Owner, any Applicable Law, any
order, writ, injunction or decree of any court, or any agreement or instrument
to which Owner is a party or by which it is bound or to which it or any of its
property or assets is subject, or constitute a default under any such agreement
or instrument.

 

15.5                           Corporate Action.  It
has all necessary power and authority to execute, deliver and perform its
obligations under this Agreement; the execution, delivery and performance by
Owner of this Agreement has been duly authorized by all necessary action on its
part; and this Agreement has been duly and validly executed and delivered by
Owner and constitutes a legal, valid and binding obligation of Owner
enforceable in accordance with its terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization or moratorium or other
similar laws relating to the enforcement of creditors’ rights generally.

 

15.6                           Financial Solvency.  Owner
intends to obtain financing from one or more Lenders to enable it to fulfill
its payment obligations under this Agreement.

 

Article 16

DEFAULT, TERMINATION AND SUSPENSION

 

16.1                           Default by Contractor.

 

A.                                   Owner Rights Upon Contractor Default.  If Contractor shall at any time: (i) fail to
commence the Work in accordance with the provisions of this Agreement; (ii)
abandon the Work; (iii) fail to achieve Substantial Completion within one
hundred and eighty (180) Days after the Guaranteed Substantial Completion Date
(as adjusted by Change Order); (iv) repudiate or fail to materially comply with
any of its material obligations under this Agreement; (v) be in Default
pursuant to Section 21.7; (vi) fail to

 

75

 

maintain insurance required under this Agreement;
(vii) materially disregard Applicable Law or Applicable Standards and Codes; or
(viii) experience an Insolvency Event (each of the foregoing being a “Default”) then, Owner has the right
(without prejudice to any other rights under the Agreement) to provide written
notice to Contractor specifying the nature of the Default and demanding that
such Default be cured.  If: (a) with
respect to any clause above (with the exception of clause (viii), (1)
Contractor fails to cure such Default within thirty (30) Days after receipt of
such notice or, (2) if the Default cannot be cured within such thirty (30) Day
period through the diligent exercise of all commercially practicable efforts,
Contractor fails to diligently exercise all commercially practicable efforts to
cure such condition or fails to cure such condition within ninety (90) Days
after receipt of such notice to cure such Default; or (b) Contractor
experiences an Insolvency Event, Owner, in the event of (a) or (b), at its sole
option and, without prejudice to any other rights that it has under this
Agreement and, upon notice to Contractor, may (y) take such steps as are reasonably
necessary to overcome the Default condition, in which case Contractor shall be
liable to Owner for any and all reasonable costs and expenses (including all
reasonable attorneys’ fees, consultant fees and arbitration expenses) incurred
by Owner in connection therewith, or (z) terminate for Default Contractor’s
performance of all of the Work.

 

B.                                     Additional Rights of Owner Upon Termination.  In the event that Owner terminates this
Agreement for Default in accordance with Section 16.1A, then Owner may, at its
sole option, (i) enter onto the Site and, for the purpose of completing the
Work, take possession of the Facility, Equipment, Construction Equipment, Work
Product, Books and Records and other items thereon owned or rented by Contractor
(subject to the relevant Construction Equipment lease or rental agreements),
(ii) take assignment of any or all of the Subcontracts, and/or (iii) either
itself or through others complete the Work. 
If the unpaid balance of the Contract Price shall exceed all actual
costs and expenses incurred by Owner on account of the termination for Default (including
all costs incurred to complete the Work in accordance with the Project
Schedule), then such excess shall be paid by Owner to Contractor, but such
amount shall not be paid until after Final Completion has been achieved.  If such amount incurred by Owner shall exceed
the unpaid balance of the Contract Price, then, at Owner’s sole option,
Contractor shall pay Owner the difference within ten (10) Days after receipt of
written notice from Owner, or, after the expiration of such ten (10) Day
period, Owner shall have the right and authority to offset or draw down on the
Letter of Credit in the amount of such difference.  For the avoidance of doubt, prior to
exercising such right to offset or collect on the Letter of Credit, Owner shall
not be required to provide the notice as set forth in Section 7.8.  Contractor’s liability under this Section 16.1B
is in addition to any other liability provided for under this Agreement and
Owner shall have the right and authority to set off against and deduct from any
such excess due Contractor by Owner any other liability of Contractor to Owner
under this Agreement.  Owner agrees to
act reasonably to mitigate any costs it might incur in connection with any
termination for Default.  Subject to the
limitation of liability set forth in Section 20.1, in addition to the amounts
recoverable above in this Section 16.1B, Owner shall be entitled to delay
damages under this Section 16.1B which, for this purpose, means (i) Delay
Liquidated Damages owed by Contractor to Owner under this Agreement up to the
date of termination, and (ii) during the period commencing after termination
and ending on the date Substantial Completion is achieved by a substitute
contractor, the costs incurred during this period by such substitute contractor
to accelerate the work in order to achieve

 

76

 

the Guaranteed Substantial Completion Date (as may
have been adjusted by Change Order) contemplated by this Agreement.

 

C.                                     Obligations Upon Termination.  Upon termination for Default in accordance
with Section 16.1A, Contractor shall (i) immediately discontinue Work on the
date specified in the notice; (ii) place no further orders for Subcontracts,
Equipment, or any other items or services; (iii) inventory, maintain and turn
over to Owner all Construction Equipment owned by Contractor and (subject to
the relevant Construction Equipment lease or rental agreements) all
Construction Equipment rented by Contractor and, in each case, present on the
Site prior to Contractor’s receipt of the termination notice or provided by
Owner for performance of the terminated Work; (iv)  promptly make every reasonable effort to
procure assignment or cancellation upon terms satisfactory to Owner of all
Subcontracts, including rental agreements; (v) cooperate with Owner in the
transfer of Work Product, including Drawings and Specifications, Permits and
any other items or information and disposition of Work in progress so as to
mitigate damages; (vi) comply with other reasonable requests from Owner
regarding the terminated Work; (vii) thereafter preserve and protect Work
already in progress and to protect Equipment at the Site or in transit thereto,
and to comply with any Applicable Law and any Applicable Codes and Standards;
and (viii) perform all other obligations under Section 16.1B.

 

16.2                           Termination for Convenience by Owner.  Owner shall have the right to terminate this
Agreement for its convenience by providing Contractor with a written notice of
termination, to be effective upon receipt by Contractor. Upon termination for
convenience, Contractor shall (i) immediately discontinue the Work on the date of
the notice, (ii) place no further orders for Subcontracts, Equipment, or any
other items or services, (iii) promptly make every reasonable effort to procure
cancellation upon terms satisfactory to Owner and Contractor of all
Subcontracts, including rental agreements, unless Owner elects to take
assignment of any such Subcontracts, (iv) assist Owner in the maintenance,
protection, and disposition of Work in progress, including Equipment at the
Site or in transit to the Site, (v) cooperate with Owner for the efficient transition
of the Work, and (vi) cooperate with Owner in the transfer of Work Product,
including Drawings and Specifications, Permits and any other items or
information and disposition of Work in progress and Owner may, at its sole
option, take assignment of any or all of the Subcontracts.  Contractor shall be paid the following
amounts no later than twenty five (25) Days after submission of Contractor’s
invoice(s) therefor: (i) the portion of the Contract Price for the Work
performed prior to termination, less that portion of the Contract Price
previously paid to Contractor; (ii) actual costs reasonably incurred by
Contractor on account of such termination (which costs shall be adequately
documented and supported by Contractor), including cancellation charges owed by
Contractor to Subcontractors (provided that Owner
does not take assignment of such Subcontracts) and costs associated with
demobilization of Contractor’s and Subcontractors’ personnel and Construction
Equipment; and (iii) in respect of loss of profit, a lump sum equal to ten
percent (10%) of the Contract Price paid to Contractor as of the effective date
of termination, less the unamortized portion of the Advance Payment (as
represented by the remaining amount of the Payment Letter of Credit) as of the
effective date of termination; provided, however, Contractor
shall not be entitled to such loss of profit if (A) in accordance with Section 16.7,
an event of Force Majeure has caused suspension of the Project for at least one
hundred and eighty (180) consecutive Days; (B) FERC Authorization has not been issued
by December 31, 2005 on terms acceptable to Owner; or (C) Owner has not
obtained project financing on or before December 31, 2005.  If no Work has been

 

77

 

performed by
Contractor at the time of termination, Contractor shall be paid the sum of One
Hundred U.S. Dollars (U.S.$100) for its undertaking to perform.

 

16.3                           Suspension of Work. 
Owner may, for any reason, at any time and from time to time, by giving
thirty (30) Days’ prior written notice to Contractor, suspend the carrying out
of the Work or any part thereof, whereupon Contractor shall suspend the
carrying out of such suspended Work for such time or times as Owner may require
and shall take reasonable steps to minimize any costs associated with such
suspension.  During any such suspension,
Contractor shall properly protect and secure such suspended Work in such manner
as Owner may reasonably require.  Unless
otherwise instructed by Owner, Contractor shall during any such suspension
maintain its staff and labor on or near the Site and otherwise be ready to
proceed expeditiously with the Work as soon as reasonably practicable after
receipt of Owner’s further instructions. Except where such suspension ordered
by Owner is the result of or due to the fault or negligence of Contractor or
any Subcontractor or Sub-subcontractor, Contractor shall be entitled to a
Change Order to recover the reasonable costs of such suspension, including
demobilization and remobilization costs, if necessary, and a time extension to
the Project Schedule if and to the extent permitted under Section 6.9.  As soon as reasonably practicable after
receipt of notice to resume suspended Work, Contractor shall promptly resume
performance of the Work to the extent required in the notice.  In no event shall Contractor be entitled to
any additional profits or damages due to such suspension.  In the event that Owner suspends all of the
Work and such suspension (i) continues for an individual period exceeding
ninety (90) consecutive Days, or (ii) in the event that one or more suspension
periods continue for more than one hundred and twenty (120) Days in the
cumulative aggregate, and provided that such
suspension is not due to the fault or negligence of Contractor or any
Subcontractor or Sub-subcontractor or an event of Force Majeure, then
Contractor shall have the right to terminate this Agreement by providing
fourteen (14) Days’ written notice to Owner. 
In the event of such termination, Contractor shall have the rights (and Owner shall make the
payments) provided for in Section 16.2.

 

16.4                           Suspension by Contractor.

 

A.                                   Suspension by Contractor for Owner’s
Failure to Pay Undisputed Amounts Before the First Draw.

 

Prior
to the First Draw, if:

 

(i)             Owner
fails to deliver the Owner Monthly Confirmation in accordance with Section 4.1A
or an Owner Monthly Confirmation indicates that either (A) Owner does not have
sufficient funds to continue to fulfill its payment obligations up to the date
of the First Draw or (B) an event has come to the attention of Owner which
would materially and adversely affect the continued availability of such
funding; and

 

(ii)          Owner
fails to pay any undisputed amount due and owing to Contractor,

 

then, provided that
Owner’s failure to pay any undisputed amount is not for a reason attributable
to Contractor or any of its Subcontractors or

 

78

 

Sub-subcontractors, Contractor may, upon providing
written notice to Owner, suspend performance of the Work until Contractor
receives such undisputed amounts and Owner delivers to Contractor an Owner
Monthly Confirmation meeting the criteria set forth in Section 4.1.  Contractor shall be entitled to a Change
Order on account of any suspension in accordance with this Section 16.4A; provided that Contractor complies with the requirements in
Sections 6.2, 6.5 and 6.9.

 

B.                                     Suspension by Contractor for Owner’s
Failure to Pay Undisputed Amounts.  If
Owner fails to pay any undisputed amount due and owing to Contractor and such
failure continues for more than thirty (30) Days after the due date for such
payment, then Contractor may suspend performance of the Work until Contractor
receives such undisputed amounts.  Prior
to any such suspension, Contractor shall provide Owner with at least fourteen
(14) Days’ prior written notice of its intent to suspend performance of the
Work.  Contractor shall be entitled to a
Change Order on account of any suspension in accordance with this Section
16.4B; provided that Contractor complies with
the requirements in Sections 6.2, 6.5 and 6.9.

 

C.                                     Suspension by Contractor for Owner’s
Failure to Fund Escrow Account.  If
Owner fails, in accordance with Section 18.4, to escrow disputed and unpaid
amounts in excess of Ten Million One Hundred Thousand U.S. Dollars
(U.S.$10,100,000) and such failure continues for more than fifteen (15) Days
after the time by which Owner is required to escrow amounts in accordance with
Section 18.4 for such disputed and unpaid amounts, then Contractor may suspend
performance of the Work until Owner escrows any disputed and unpaid amounts
exceeding Ten Million U.S. Dollars (U.S.$10,000,000).  Prior to any such suspension, Contractor
shall provide Owner with at least ten (10) Days’ prior written notice of its
intent to suspend performance of the Work.  Contractor shall be entitled to a
Change Order on account of any suspension in accordance with this Section
16.4C; provided that Contractor complies with
the requirements in Sections 6.2, 6.5 and 6.9.

 

D.                                    Undisputed Amounts.  An amount shall be considered “undisputed”
under Sections 16.4A, 16.4B and 16.5 if the amount invoiced by Contractor is
contested in bad faith by Owner or if Owner has failed to give notice of a
disputed amount in accordance with Section 7.2E by the due date for payment of
the applicable invoiced amount.

 

16.5                           Termination by Contractor. If Owner shall at any time: (i)
fail to pay any undisputed amount; (ii) fail to materially comply with any of
its material obligations under this Agreement (but only to the extent such
material failure and the impact thereof is not subject to adjustment by Change
Order as set forth in Section 6.2); or (iii) experience an Insolvency Event
(each of the foregoing being an “Owner Default”)
then, Contractor has the right (without prejudice to any other rights under the
Agreement) to provide written notice to Owner specifying the nature of the
Owner Default and demanding that such Owner Default be cured.  If: (a) with respect to clause (i) Owner
fails to cure such Owner Default within forty-five (45) Days after receipt of
such notice; (b) with respect to clause (ii), (1) Owner fails to cure such
Owner Default within forty-five (45) Days after receipt of such notice or, (2)
if the Owner Default cannot be cured within such forty five (45) Day period
through the diligent exercise of all commercially practicable efforts, Owner
fails to diligently exercise all commercially practicable efforts to cure such
condition or fails to

 

79

 

cure such
condition within ninety (90) Days after receipt of such notice to cure such
Owner Default; or (c) Owner experiences an Insolvency Event, Contractor may, in
the event of (a), (b) or (c), at its sole option and without prejudice to any
other rights that it has under this Agreement, and upon notice to Owner,
terminate this Agreement.  In the event
of such termination under this Section 16.5, Contractor shall have the rights
(and Owner shall make the payments) provided for in Section 16.2 in the event
of an Owner termination for convenience.

 

16.6                           Termination in the Event of Delayed Notice to Proceed.  In the event Owner fails to issue the NTP in
accordance with Section 5.2B by December 31, 2005, then either Party shall have
the right to terminate this Agreement by providing a written notice of
termination to the other Party, to be effective upon receipt by the other
Party. In the event of such termination, Contractor shall have the rights (and
Owner shall make the payments) provided for in Section 16.2, except that, in
respect of loss of profit, Contractor shall only be entitled to a lump sum
equal to One Hundred Fifty Thousand U.S. Dollars (U.S.$150,000).

 

16.7                           Termination in the Event of an Extended Force Majeure. In
the event (i) any one Force Majeure event or the effects thereof causes
suspension of a substantial portion of the Work for a period exceeding one
hundred (100) consecutive Days or (ii) any one or more Force Majeure events or
the effects thereof causes suspension of a substantial portion of the Work for
a period exceeding one hundred and eighty (180) Days in the aggregate during
any continuous twenty-four (24) month period, then either Party shall have the
right to terminate this Agreement by providing fourteen (14) Days’ written
notice of termination to the other Party, to be effective upon receipt by such
other Party.  In the event of such
termination, Contractor shall have the rights (and Owner shall make the
payments) provided for in Section 16.2.

 

16.8                           Contractor’s Right to Terminate.  Contractor’s sole right to terminate this
Agreement is specified in Sections 16.3, 16.5, 16.6 and 16.7.

 

Article 17

INDEMNITIES

 

17.1                           General Indemnification. 
IN ADDITION TO ITS
INDEMNIFICATION, DEFENSE AND HOLD HARMLESS OBLIGATIONS CONTAINED ELSEWHERE IN
THIS AGREEMENT, CONTRACTOR SHALL INDEMNIFY, HOLD HARMLESS AND DEFEND THE OWNER
GROUP FROM ANY AND ALL DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL
REASONABLE ATTORNEYS’ FEES AND LITIGATION OR ARBITRATION EXPENSES) TO THE
EXTENT THAT SUCH DAMAGES, LOSSES, COSTS AND EXPENSES RESULT FROM ANY OF THE
FOLLOWING:

 

A.                                   FAILURE OF CONTRACTOR OR ITS SUBCONTRACTORS
OR SUB-SUBCONTRACTORS TO COMPLY WITH APPLICABLE LAW; PROVIDED
THAT THIS INDEMNITY SHALL BE LIMITED TO FINES AND PENALTIES IMPOSED
ON OWNER GROUP AND RESULTING FROM THE FAILURE OF CONTRACTOR OR ITS
SUBCONTRACTORS OR SUB-SUBCONTRACTORS TO COMPLY WITH APPLICABLE LAW;

 

B.                                     WITH THE EXCEPTION OF ACTUAL OR ASSERTED
VIOLATION OR INFRINGEMENT OF ANY DOMESTIC OR FOREIGN PATENTS, COPYRIGHTS OR TRADEMARKS
OR OTHER INTELLECTUAL PROPERTY RELATED TO (I) THE DOCUMENTS AND INFORMATION

 

80

 

PREPARED BY BLACK &
VEATCH OR SHINER MOSELEY, OR (II) THE USE FOR THE PROJECT OF THE BOIL-OFF GAS
CONDENSER SYSTEM DESCRIBED IN U.S. PATENT NO. 6,745,576B1, “NATURAL GAS VAPOR
GAS RECONDENSER SYSTEM,” DATED JUNE 8, 2004, ANY AND ALL DAMAGES, LOSSES, COSTS
AND EXPENSES SUFFERED BY A THIRD PARTY AND RESULTING FROM ACTUAL OR ASSERTED
VIOLATION OR INFRINGEMENT OF ANY DOMESTIC OR FOREIGN PATENTS, COPYRIGHTS OR
TRADEMARKS OR OTHER INTELLECTUAL PROPERTY OWNED BY A THIRD PARTY TO THE EXTENT
THAT SUCH VIOLATION OR INFRINGEMENT RESULTS FROM PERFORMANCE OF THE WORK BY
CONTRACTOR OR ANY OF ITS SUBCONTRACTORS OR SUB-SUBCONTRACTORS, OR ANY IMPROPER
USE OF THIRD PARTY CONFIDENTIAL INFORMATION OR OTHER THIRD PARTY PROPRIETARY
RIGHTS THAT MAY BE ATTRIBUTABLE TO CONTRACTOR OR ANY SUBCONTRACTOR OR
SUB-SUBCONTRACTOR IN CONNECTION WITH THE WORK;

 

C.                                     CONTAMINATION OR POLLUTION SUFFERED BY A THIRD
PARTY TO THE EXTENT RESULTING FROM CONTRACTOR’S OR ANY SUBCONTRACTOR’S OR
SUB-SUBCONTRACTOR’S USE, HANDLING OR DISPOSAL OF HAZARDOUS MATERIALS BROUGHT ON
THE SITE OR ON THE OFF-SITE RIGHTS OF WAYS AND EASEMENTS BY CONTRACTOR OR ANY
SUBCONTRACTOR OR SUB-SUBCONTRACTOR;

 

D.                                    FAILURE BY CONTRACTOR OR ANY SUBCONTRACTOR OR
SUB-SUBCONTRACTOR TO PAY TAXES FOR WHICH SUCH PERSON IS LIABLE;

 

E.                                      FAILURE OF CONTRACTOR TO MAKE PAYMENTS TO ANY
SUBCONTRACTOR IN ACCORDANCE WITH THE RESPECTIVE SUBCONTRACT, BUT NOT EXTENDING
TO ANY SETTLEMENT PAYMENT MADE BY OWNER TO ANY SUBCONTRACTOR AGAINST WHICH
CONTRACTOR HAS PENDING OR PROSPECTIVE CLAIMS, UNLESS SUCH SETTLEMENT IS MADE
WITH CONTRACTOR’S CONSENT, EXCEPT AFTER ASSUMPTION OF SUCH SUBCONTRACT BY OWNER
IN ACCORDANCE WITH SECTION 16.1B; OR

 

F.                                      PERSONAL INJURY TO OR DEATH OF ANY PERSON
(OTHER THAN EMPLOYEES OF ANY MEMBER OF THE CONTRACTOR GROUP, THE OWNER GROUP OR
ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR), AND DAMAGE TO OR DESTRUCTION OF
PROPERTY OF THIRD PARTIES TO THE EXTENT ARISING OUT OF OR RESULTING FROM THE
NEGLIGENCE IN CONNECTION WITH THE WORK OF ANY MEMBER OF THE CONTRACTOR GROUP OR
ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR OR ANYONE DIRECTLY OR INDIRECTLY
EMPLOYED BY THEM.

 

17.2                           Injuries to Contractor’s Employees and Damage to Contractor’s Property. NOTWITHSTANDING THE PROVISIONS OF SECTION
17.1F, AND EXCEPT AS OTHERWISE PROVIDED IN SECTION 4.7, CONTRACTOR SHALL
DEFEND, INDEMNIFY AND HOLD HARMLESS THE OWNER GROUP FROM AND AGAINST ALL
DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES,
AND LITIGATION OR ARBITRATION EXPENSES) ARISING OUT OF OR RESULTING FROM OR
RELATED TO (I) INJURY TO OR DEATH OF EMPLOYEES, OFFICERS OR DIRECTORS OF ANY
MEMBER OF THE CONTRACTOR GROUP OR ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR OR
(II) DAMAGE TO OR DESTRUCTION OF PROPERTY OF ANY MEMBER OF THE CONTRACTOR GROUP
OR ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR OCCURRING IN CONNECTION WITH THE WORK
OR THE PROJECT, REGARDLESS OF THE CAUSE OF SUCH INJURY, DEATH, DAMAGE OR
DESTRUCTION,

 

81

 

INCLUDING THE SOLE OR JOINT NEGLIGENCE, BREACH OF CONTRACT OR OTHER
BASIS OF LIABILITY OF ANY MEMBER OF THE OWNER GROUP.

 

17.3                           Injuries to Owner’s Employees and Damage to Owner’s Property.  EXCEPT
AS OTHERWISE PROVIDED IN SECTIONS 3.17 AND 17.1C, OWNER SHALL DEFEND, INDEMNIFY
AND HOLD HARMLESS THE CONTRACTOR GROUP FROM AND AGAINST ALL DAMAGES, LOSSES,
COSTS AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES,  AND LITIGATION OR ARBITRATION EXPENSES) RESULTING
FROM OR RELATED TO (I) INJURY TO OR DEATH OF ANY MEMBER OF THE OWNER GROUP OR
EMPLOYEES OF OWNER’S OTHER CONTRACTORS (II) DAMAGE TO OR DESTRUCTION OF
PROPERTY OF OWNER GROUP (EXCLUDING THE WORK, THE FACILITY AND THE PROJECT) OR
OF OWNER’S OTHER CONTRACTORS OCCURING IN CONNECTION WITH THE PROJECT,
REGARDLESS OF THE CAUSE OF SUCH INJURY, DEATH, DAMAGE OR DESTRUCTION, INCLUDING
THE SOLE OR JOINT NEGLIGENCE, BREACH OF CONTRACT OR OTHER BASIS OF LIABILITY OF
ANY MEMBER OF THE CONTRACTOR GROUP.

 

17.4                           Patent and Copyright Indemnification Procedure.  IN
THE EVENT THAT ANY VIOLATION OR INFRINGEMENT FOR WHICH CONTRACTOR IS
RESPONSIBLE TO INDEMNIFY THE OWNER GROUP AS SET FORTH IN SECTION 17.1B
RESULTS IN ANY SUIT, CLAIM, TEMPORARY RESTRAINING ORDER OR PRELIMINARY
INJUNCTION CONTRACTOR SHALL, IN ADDITION TO ITS OBLIGATIONS UNDER
SECTION 17.1B, MAKE EVERY REASONABLE EFFORT, BY GIVING A SATISFACTORY BOND
OR OTHERWISE, TO SECURE THE SUSPENSION OF THE INJUNCTION OR RESTRAINING ORDER.  IF, IN ANY SUCH SUIT OR CLAIM, THE WORK, THE
FACILITY, OR ANY PART, COMBINATION OR PROCESS THEREOF, IS HELD TO CONSTITUTE AN
INFRINGEMENT AND ITS USE IS PRELIMINARILY OR PERMANENTLY ENJOINED, CONTRACTOR
SHALL PROMPTLY MAKE EVERY REASONABLE EFFORT TO SECURE FOR OWNER A LICENSE, AT
NO COST TO OWNER, AUTHORIZING CONTINUED USE OF THE INFRINGING WORK.  IF CONTRACTOR IS UNABLE TO SECURE SUCH A
LICENSE WITHIN A REASONABLE TIME, CONTRACTOR SHALL, AT ITS OWN EXPENSE AND
WITHOUT IMPAIRING PERFORMANCE REQUIREMENTS, EITHER REPLACE THE AFFECTED WORK,
IN WHOLE OR PART, WITH NON-INFRINGING COMPONENTS OR PARTS OR MODIFY THE SAME SO
THAT THEY BECOME NON-INFRINGING.

 

17.5                           Lien Indemnification. 
SHOULD CONTRACTOR OR ANY
SUBCONTRACTOR OR SUB-SUBCONTRACTOR OR ANY OTHER PERSON, INCLUDING ANY
CONSTRUCTION EQUIPMENT LESSOR, ACTING THROUGH OR UNDER ANY OF THEM FILE A LIEN
OR OTHER ENCUMBRANCE AGAINST ALL OR ANY PORTION OF THE WORK, THE SITE OR THE
FACILITY, CONTRACTOR SHALL, AT ITS SOLE COST AND EXPENSE, REMOVE OR DISCHARGE,
BY PAYMENT, BOND OR OTHERWISE, SUCH LIEN OR ENCUMBRANCE WITHIN TWENTY-ONE (21)
DAYS OF CONTRACTOR’S RECEIPT OF WRITTEN NOTICE FROM OWNER NOTIFYING CONTRACTOR
OF SUCH LIEN OR ENCUMBRANCE; PROVIDED THAT OWNER
SHALL HAVE MADE PAYMENT OF ALL AMOUNTS PROPERLY DUE AND OWING TO CONTRACTOR
UNDER THIS AGREEMENT, OTHER THAN AMOUNTS DISPUTED IN ACCORDANCE WITH SECTION
7.2E.  IF CONTRACTOR FAILS TO REMOVE OR
DISCHARGE ANY SUCH LIEN OR ENCUMBRANCE WITHIN SUCH TWENTY-ONE (21) DAY PERIOD
IN CIRCUMSTANCES WHERE OWNER HAS MADE PAYMENT OF ALL AMOUNTS PROPERLY DUE AND
OWING TO CONTRACTOR UNDER THIS AGREEMENT, OTHER THAN AMOUNTS DISPUTED IN
ACCORDANCE WITH SECTION 7.2E, THEN OWNER MAY, IN ITS SOLE DISCRETION AND IN
ADDITION TO ANY OTHER RIGHTS THAT IT HAS UNDER THIS AGREEMENT, REMOVE OR
DISCHARGE SUCH LIEN AND ENCUMBRANCE USING WHATEVER MEANS THAT OWNER, IN ITS
SOLE DISCRETION, DEEMS APPROPRIATE, INCLUDING THE PAYMENT OF SETTLEMENT AMOUNTS
THAT IT DETERMINES IN ITS SOLE DISCRETION AS BEING NECESSARY TO REMOVE OR DISCHARGE
SUCH

 

82

 

LIEN OR ENCUMBRANCE.  IN SUCH
CIRCUMSTANCE, CONTRACTOR SHALL BE LIABLE TO OWNER FOR ALL DAMAGES, COSTS,
LOSSES AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES, CONSULTANT FEES
AND ARBITRATION EXPENSES, AND SETTLEMENT PAYMENTS) INCURRED BY OWNER ARISING
OUT OF OR RELATING TO SUCH REMOVAL OR DISCHARGE.  ALL SUCH DAMAGES, COSTS, LOSSES AND EXPENSES
SHALL BE PAID BY CONTRACTOR NO LATER THAN THIRTY (30) DAYS AFTER RECEIPT OF
EACH INVOICE FROM OWNER.

 

17.6                           Owner’s Failure to Comply with Applicable Law.  OWNER
SHALL DEFEND, INDEMNIFY AND HOLD HARMLESS THE CONTRACTOR GROUP FROM ANY AND ALL
DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES
AND LITIGATION OR ARBITRATION EXPENSES) ARISING OUT OF OR RESULTING FROM THE
FAILURE OF ANY MEMBER OF OWNER GROUP TO COMPLY WITH APPLICABLE LAW; PROVIDED THAT THIS INDEMNITY SHALL BE LIMITED TO FINES AND
PENALTIES IMPOSED ON CONTRACTOR GROUP AND RESULTING FROM OWNER’S FAILURE TO
COMPLY WITH APPLICABLE LAW.

 

17.7                           Landowner Claims.  SUBJECT TO CONTRACTOR’S INDEMNIFICATION
OBLIGATIONS SET FORTH IN SECTIONS 17.1A AND 17.1C, OWNER SHALL DEFEND,
INDEMNIFY AND HOLD HARMLESS THE CONTRACTOR GROUP FROM AND AGAINST ANY AND ALL
DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL REASONABLE ATTORNEYS’ FEES,
AND LITIGATION OR ARBITRATION EXPENSES) ARISING OUT OF OR RESULTING FROM CLAIMS
OCCURRING IN CONNECTION WITH THE WORK AND THE PROJECT AND BROUGHT BY ANY
LANDOWNER ON WHOSE LAND, RIGHT OR WAY OR EASEMENT CONTRACTOR OR ANY OF ITS
SUBCONTRACTORS OR SUB-SUBCONTRACTORS ARE PERFORMING THE WORK, INCLUDING ANY
CLAIM FROM SUCH LANDOWNER RELATED TO DAMAGE TO OR DESTRUCTION OF PROPERTY.  SUCH INDEMNITY SHALL APPLY REGARDLESS OF THE
CAUSE OF SUCH DAMAGES, LOSSES, COSTS AND EXPENSES, INCLUDING NEGLIGENCE, BREACH
OF CONTRACT OR OTHER BASIS OF LIABILITY OF ANY MEMBER OF THE CONTRACTOR GROUP
OR ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR.

 

17.8                           Legal Defense.  NOT
LATER THAN FIFTEEN (15) DAYS AFTER RECEIPT OF WRITTEN NOTICE FROM THE
INDEMNIFIED PARTY TO THE INDEMNIFYING PARTY OF ANY CLAIMS, DEMANDS, ACTIONS OR
CAUSES OF ACTION ASSERTED AGAINST SUCH INDEMNIFIED PARTY FOR WHICH THE
INDEMNIFYING PARTY HAS INDEMNIFICATION, DEFENSE AND HOLD HARMLESS OBLIGATIONS
UNDER THIS AGREEMENT, WHETHER SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION IS
ASSERTED IN A LEGAL, JUDICIAL, ARBITRAL OR ADMINISTRATIVE PROCEEDING OR ACTION
OR BY NOTICE WITHOUT INSTITUTION OF SUCH LEGAL, JUDICIAL, ARBITRAL OR
ADMINISTRATIVE PROCEEDING OR ACTION, THE INDEMNIFYING PARTY SHALL AFFIRM IN
WRITING BY NOTICE TO SUCH INDEMNIFIED PARTY THAT THE INDEMNIFYING PARTY WILL
INDEMNIFY, DEFEND AND HOLD HARMLESS SUCH INDEMNIFIED PARTY AND SHALL, AT THE
INDEMNIFYING PARTY’S OWN COST AND EXPENSE, ASSUME ON BEHALF OF THE INDEMNIFIED
PARTY AND CONDUCT WITH DUE DILIGENCE AND IN GOOD FAITH THE DEFENSE THEREOF WITH
COUNSEL SELECTED BY THE INDEMNIFYING PARTY AND REASONABLY SATISFACTORY TO SUCH
INDEMNIFIED PARTY; PROVIDED, HOWEVER,
THAT SUCH INDEMNIFIED PARTY SHALL HAVE THE
RIGHT TO BE REPRESENTED THEREIN BY ADVISORY COUNSEL OF ITS OWN SELECTION, AND
AT ITS OWN EXPENSE; AND PROVIDED FURTHER
THAT IF THE DEFENDANTS IN ANY SUCH ACTION OR PROCEEDING INCLUDE THE
INDEMNIFYING PARTY AND AN INDEMNIFIED PARTY AND THE INDEMNIFIED PARTY SHALL
HAVE REASONABLY CONCLUDED THAT THERE MAY BE LEGAL DEFENSES AVAILABLE TO IT
WHICH ARE DIFFERENT FROM OR ADDITIONAL TO, OR INCONSISTENT WITH, THOSE
AVAILABLE TO THE INDEMNIFYING PARTY, SUCH INDEMNIFIED PARTY SHALL HAVE

 

83

 

THE RIGHT TO SELECT UP TO ONE SEPARATE COUNSEL TO PARTICIPATE IN THE
DEFENSE OF SUCH ACTION OR PROCEEDING ON ITS OWN BEHALF AT THE REASONABLE
EXPENSE OF THE INDEMNIFYING PARTY.  IN
THE EVENT OF THE FAILURE OF THE INDEMNIFYING PARTY TO PERFORM FULLY IN ACCORDANCE
WITH THE DEFENSE OBLIGATIONS UNDER THIS SECTION 17.8, SUCH INDEMNIFIED PARTY
MAY, AT ITS OPTION, AND WITHOUT RELIEVING THE INDEMNIFYING PARTY OF ITS
OBLIGATIONS HEREUNDER, SO PERFORM, BUT ALL DAMAGES, COSTS AND EXPENSES
(INCLUDING ALL REASONABLE ATTORNEYS’ FEES, AND LITIGATION OR ARBITRATION
EXPENSES, SETTLEMENT PAYMENTS AND JUDGMENTS) SO INCURRED BY SUCH INDEMNIFIED
PARTY IN THAT EVENT SHALL BE REIMBURSED BY THE INDEMNIFYING PARTY TO SUCH
INDEMNIFIED PARTY, TOGETHER WITH INTEREST ON SAME FROM THE DATE ANY SUCH COST
AND EXPENSE WAS PAID BY SUCH INDEMNIFIED PARTY UNTIL REIMBURSED BY THE
INDEMNIFYING PARTY AT THE INTEREST RATE SET FORTH IN SECTION 7.6 OF THIS
AGREEMENT.

 

17.9                           Enforceability.

 

A.                                   EXCEPT AS OTHERWISE SET FORTH IN SECTIONS
17.2 AND 17.3, THE INDEMNITY, DEFENSE AND HOLD HARMLESS OBLIGATIONS FOR
PERSONAL INJURY OR DEATH OR PROPERTY DAMAGE UNDER THIS AGREEMENT SHALL APPLY
REGARDLESS OF WHETHER THE INDEMNIFIED PARTY WAS CONCURRENTLY NEGLIGENT (WHETHER
ACTIVELY OR PASSIVELY), IT BEING AGREED BY THE PARTIES THAT IN THIS EVENT, THE PARTIES’
RESPECTIVE LIABILITY OR RESPONSIBILITY FOR SUCH DAMAGES, LOSSES, COSTS AND
EXPENSES UNDER THIS ARTICLE 17 SHALL BE DETERMINED IN ACCORDANCE WITH
PRINCIPLES OF COMPARATIVE NEGLIGENCE.

 

B.                                     OWNER AND CONTRACTOR AGREE THAT THE LOUISIANA
OILFIELD ANTI-INDEMNITY ACT, LA. REV. STAT. 
§9:2780, ET. SEQ., IS INAPPLICABLE TO THIS AGREEMENT AND THE
PERFORMANCE OF THE WORK.  APPLICATION OF
THESE CODE SECTIONS TO THIS AGREEMENT WOULD BE CONTRARY TO THE INTENT OF THE
PARTIES, AND EACH PARTY HEREBY IRREVOCABLY WAIVES ANY CONTENTION THAT THESE
CODES SECTIONS ARE APPLICABLE TO THIS AGREEMENT OR THE WORK.  IN ADDITION, IT IS THE INTENT OF THE PARTIES
IN THE EVENT THAT THE AFOREMENTIONED ACT WERE TO APPLY THAT EACH PARTY SHALL PROVIDE
INSURANCE TO COVER THE LOSSES CONTEMPLATED BY SUCH CODE SECTIONS AND ASSUMED BY
EACH SUCH PARTY UNDER THE INDEMNIFICATION PROVISIONS OF THIS AGREEMENT, AND
CONTRACTOR AGREES THAT THE CONTRACT PRICE (AS MAY BE ADJUSTED BY CHANGE ORDER
IN ACCORDANCE WITH SECTION 7.1B) COMPENSATES CONTRACTOR FOR THE COST OF
PREMIUMS FOR THE INSURANCE PROVIDED BY IT UNDER THIS AGREEMENT.  THE PARTIES AGREE THAT EACH PARTY’S AGREEMENT
TO SUPPORT THEIR INDEMNIFICATION OBLIGATIONS BY INSURANCE SHALL IN NO RESPECT
IMPAIR THEIR INDEMNIFICATION OBLIGATIONS.

 

C.                                     IN THE EVENT THAT ANY INDEMNITY PROVISIONS IN
THIS AGREEMENT ARE CONTRARY TO THE LAW GOVERNING THIS AGREEMENT, THEN THE
INDEMNITY OBLIGATIONS APPLICABLE HEREUNDER SHALL BE APPLIED TO THE MAXIMUM
EXTENT ALLOWED BY APPLICABLE LAW.

 

84

 

Article 18

DISPUTE RESOLUTION

 

18.1                           Negotiation.  In the
event that any claim, dispute or controversy arising out of or relating to this
Agreement (including the breach, termination or invalidity thereof, and whether
arising out of tort or contract) (“Dispute”)
cannot be resolved informally within thirty (30) Days after the Dispute arises,
either Party may give written notice of the Dispute (“Dispute
Notice”) to the other Party requesting that a representative of
Owner’s senior management and Contractor’s senior management meet in an attempt
to resolve the Dispute. Each such management representative shall have full
authority to resolve the Dispute and shall meet at a mutually agreeable time
and place within thirty (30) Days after receipt by the non-notifying Party of
such Dispute Notice, and thereafter as often as they deem reasonably necessary
to exchange relevant information and to attempt to resolve the Dispute.  In no event shall this Section 18.1 be
construed to limit either Party’s right to take any action under this
Agreement, including Owner’s rights under Section 16.1.  The Parties agree that if any Dispute is not
resolved within ninety (90) Days after receipt of the Dispute Notice given in
this Section 18.1, then either Party may by notice to the other Party refer the
Dispute to be decided by final and binding arbitration in accordance with
Section 18.2.

 

A.                                   Notwithstanding
the foregoing, in the event of a Dispute regarding (i) whether a specific item
of Work meets the definition of Punchlist under Section 1.1 in connection with
Section 11.6, or (ii) if and when RFCD, Substantial Completion or Final
Completion has occurred, as applicable, in accordance with Section 11.4A, 11.4B
or 11.7, representatives of Owner’s senior management and Contractor’s senior
management shall meet immediately upon request of either Party to attempt to
resolve such Dispute.  Each such
management representative shall have full authority to resolve such Dispute and
shall meet in person at a mutually agreeable time and place.  The Parties agree that if any such Dispute is
not resolved within five (5) Business Days after either Party’s request for such
meeting between management representatives, then either Party may by notice to
the other Party refer the Dispute to be decided by final and binding
arbitration in accordance with Section 18.2.

 

18.2                           Arbitration.  Any
arbitration held under this Agreement shall be held in Houston, Texas, unless
otherwise agreed by the Parties, shall be administered by the Dallas, Texas
office of the American Arbitration Association (“AAA”)
and shall, except as otherwise modified by this Section 18.2, be governed by
the AAA’s Construction Industry Arbitration Rules and Mediation Procedures
(including Procedures for Large, Complex Construction Disputes) (the “AAA Rules”).  The number of arbitrators required for the
arbitration hearing shall be determined in accordance with the AAA Rules.  The arbitrator(s) shall determine the rights
and obligations of the Parties according to the substantive law of the state of
Texas, excluding its conflict of law principles, as would a court for the state
of Texas; provided, however, the law applicable to
the validity of the arbitration clause, the conduct of the arbitration,
including resort to a court for provisional remedies, the enforcement of any
award and any other question of arbitration law or procedure shall be the
Federal Arbitration Act, 9 U.S.C.A. § 2. 
Issues concerning the arbitrability of a matter in dispute shall be
decided by a court with proper jurisdiction. 
The Parties shall be entitled to engage in reasonable discovery,
including the right to production of relevant and material documents by the
opposing Party and the right to take depositions reasonably limited in number,
time and place; provided that in no event shall
any Party be entitled to refuse to produce relevant and non-privileged
documents or copies thereof requested by the other Party within the time limit
set and to the extent required by order of the arbitrator(s).  All disputes regarding discovery shall

 

85

 

be promptly
resolved by the arbitrator(s).  This
agreement to arbitrate is binding upon the Parties, Contractor’s surety (if
any) and the successors and permitted assigns of any of them.  At either Party’s option, any other Person
may be joined as an additional party to any arbitration conducted under this
Section 18.2, provided that the party to be
joined is or may be liable to either Party in connection with all or any part
of any dispute between the Parties. The arbitration award shall be final and
binding, in writing, signed by all arbitrators, and shall state the reasons
upon which the award thereof is based. 
The Parties agree that judgment on the arbitration award may be entered
by any court having jurisdiction thereof.

 

18.3                           Continuation of Work During Dispute.  Notwithstanding any Dispute, it shall be the
responsibility of each Party to continue to perform its obligations under this
Agreement pending resolution of Disputes. 
Owner shall, subject to its right to withhold or offset amounts pursuant
to this Agreement, continue to pay Contractor undisputed amounts in accordance
with this Agreement and, except as provided in this Agreement, continue to
perform all of its obligations under this Agreement; provided,
however, in no event shall the occurrence of any negotiation or
arbitration prevent or affect Owner from exercising its rights under this
Agreement, including Owner’s right to terminate pursuant to Article 16.

 

18.4                           Escrow of Certain Disputed Amounts By Owner.  At any time when the total amounts invoiced
by Contractor pursuant to Section 7.2C of the Agreement for Milestone payments
and Monthly Payments (as such amounts may be adjusted by Change Order in
accordance with Sections 6.1B or 6.2C) which are disputed and unpaid by Owner
exceed Ten Million U.S. Dollars (U.S.$10,000,000) in the cumulative aggregate, Owner
shall escrow any such disputed and unpaid amounts in excess of the aforesaid
amount (“Escrowed Amounts”);
provided, however, the Parties
acknowledge and agree that such Escrowed Amounts shall not include any claims
by Contractor for compensation in addition to the original Contract Price (as
adjusted by Change Order pursuant to Sections 6.1B or 6.2C).  For the purposes of determining the date when
Owner must deposit the Escrowed Amounts with the Escrow Agent, amounts are “unpaid”
on the date that Owner is required to make payment of an Invoice under Section
7.2E of this Agreement.  The Escrowed
Amounts will be deposited with the Escrow Agent pursuant to the Escrow
Agreement (which provides, among other things, that the Escrowed Amounts shall
be held in an interest bearing account and disbursed upon the instructions of
both Parties or pursuant to an arbitration award).  Prior to issuance of the NTP, (i) the Escrow
Agent shall be selected by mutual agreement of the Parties and (ii) the Escrow
Agreement shall be in final form and executed by the Escrow Agent and each
Party.  The Parties shall each pay fifty
percent (50%) of the cost of the Escrow Agreement including without limitation
the fees and expenses of the Escrow Agent.

 

Article 19

CONFIDENTIALITY

 

19.1                           Contractor’s Obligations. 
Contractor hereby covenants and warrants that Contractor and its
employees and agents shall not (without in each instance obtaining Owner’s
prior written consent) disclose, make commercial or other use of, or give or
sell to any Person, other than to members of the Contractor Group and Subcontractors
or Sub-subcontractors as necessary to perform the Work, any information
conspicuously marked and identified in writing as confidential and relating to
the business, products, services, research or development, clients or customers
of Owner or any Owner Affiliate, or relating to similar information of a Third
Party who

 

86

 

has entrusted such
information to Owner or any Owner Affiliate (hereinafter individually or
collectively, “Owner’s Confidential Information”).  Prior to disclosing any such information to
any Subcontractor or Sub-subcontractor as necessary to perform the Work,
Contractor shall bind such Subcontractor or Sub-subcontractor to the
confidentiality obligations contained in this Section 19.1.  Nothing in this Section 19.1 or this
Agreement shall in any way prohibit Contractor or any of its Subcontractors or
Sub-subcontractors from making commercial or other use of, selling, or
disclosing any of their respective Contractor’s Intellectual Property or Third
Party Proprietary Work Product.

 

19.2                           Owner’s Obligations.  Owner hereby covenants and warrants that
Owner and its employees and agents shall not (without in each instance
obtaining Contractor’s prior written consent) disclose, make commercial or
other use of, or give or sell to any Person any of the following information:
(i) any estimating, technical or pricing methodologies, techniques, know-how or
information relating to the business, products, services, research or
development of Contractor conspicuously marked and identified in writing as
confidential by Contractor; or (ii) any of Contractor’s Intellectual Property
or Third Party Proprietary Work Product which is conspicuously marked and
identified in writing as confidential (hereinafter individually or
collectively, “Contractor’s Confidential Information”).  The Parties agree that (y) notwithstanding
the foregoing, Owner shall not be restricted from the use or disclosure of Work
Product except as expressly set forth in Article 10; and (z) Owner shall be
entitled to disclose that portion of Contractor’s Intellectual Property and
Third Party Proprietary Work Product for which Owner has a license in, and
which is to be used by Owner for the purpose for which such license is granted
pursuant to Section 10.1, provided that,
with respect to such Contractor’s Intellectual Property and Third Party
Proprietary Work Product, Owner binds such disclosee to the confidentiality
obligations contained in this Section 19.2.

 

19.3                           Definitions.  The term
“Confidential Information” shall mean
one or both of Contractor’s Confidential Information and Owner’s Confidential
Information, as the context requires. 
The Party having the confidentiality obligations with respect to such
Confidential Information shall be referred to as the “Receiving
Party,” and the Party to whom such confidentiality obligations
are owed shall be referred to as the “Disclosing Party.”

 

19.4                           Exceptions. 
Notwithstanding Sections 19.1 and 19.2, Confidential Information shall
not include: (i) information which at the time of disclosure or acquisition is
in the public domain, or which after disclosure or acquisition becomes part of
the public domain without violation of Article 19; (ii) information which at
the time of disclosure or acquisition was already in the possession of the Receiving
Party or its employees or agents and was not previously acquired from the
Disclosing Party or any of its employees or agents directly or indirectly;
(iii) information which the Receiving Party can show was acquired by such
entity after the time of disclosure or acquisition hereunder from a Third Party
without any confidentiality commitment, if, to the best of Receiving Party’s or
its employees’ or agent’s knowledge, such Third Party did not acquire it,
directly or indirectly, from the Disclosing Party or any of its employees or
agents; (iv) information independently developed by the Receiving Party without
benefit of the Confidential Information; and (v) information which a Party
believes in good faith is required to be disclosed in connection with the
Project by Applicable Law, any Governmental Instrumentality (including the
FERC), applicable securities laws or the rules of any stock exchange; provided, however, that prior to such disclosure, the
Receiving Party gives reasonable notice to the Disclosing Party of the

 

87

 

information
required to be disclosed.

 

19.5                           Equitable Relief.  The
Parties acknowledge that in the event of a breach of any of the terms contained
in this Article 19, the Disclosing Party would suffer irreparable harm for
which remedies at law, including damages, would be inadequate, and that the
Disclosing Party shall be entitled to seek equitable relief therefor by
injunction, without the requirement of posting a bond.

 

19.6                           Term.  The confidentiality obligations of this Article 19 shall expire upon
the earlier of a period of ten (10) years following (i) the termination of this
Agreement or (ii) Final Completion.

 

Article 20

LIMITATION OF LIABILITY

 

20.1                           Contractor Aggregate Liability.  NOTWITHSTANDING
ANY OTHER PROVISIONS OF THIS AGREEMENT TO THE CONTRARY, CONTRACTOR GROUP SHALL
NOT BE LIABLE TO OWNER GROUP UNDER THIS AGREEMENT OR UNDER ANY CAUSE OF ACTION
RELATED TO THE SUBJECT MATTER OF THIS AGREEMENT, WHETHER IN CONTRACT, WARRANTY,
TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, PRODUCTS LIABILITY, PROFESSIONAL
LIABILITY, INDEMNITY, CONTRIBUTION OR ANY OTHER CAUSE OF ACTION, IN EXCESS OF A
CUMULATIVE AGGREGATE AMOUNT OF THIRTY PERCENT (30%) OF THE CONTRACT PRICE, AND
OWNER SHALL RELEASE CONTRACTOR GROUP FROM ANY LIABILITY IN EXCESS THEREOF; PROVIDED THAT, NOTWITHSTANDING THE FOREGOING, THE LIMITATION
OF LIABILITY SET FORTH IN THIS SECTION 20.1 SHALL NOT (I) APPLY TO (A)
CONTRACTOR’S INDEMNIFICATION OBLIGATIONS UNDER SECTIONS 17.1B, 17.1E, 17.1F,
17.2 AND 17.5 OR (B) CONTRACTOR’S OBLIGATIONS UNDER 8.1A.1; OR (II) INCLUDE THE
PROCEEDS PAID UNDER ANY INSURANCE POLICY THAT CONTRACTOR OR ITS SUBCONTRACTORS
IS REQUIRED TO OBTAIN PURSUANT TO THIS AGREEMENT OR SUBCONTRACT, AS THE CASE
MAY BE.  IN NO EVENT SHALL THE LIMITATION
OF LIABILITY SET FORTH IN THIS SECTION 20.1 BE IN ANY WAY DEEMED TO LIMIT
CONTRACTOR’S OBLIGATION TO PERFORM ALL WORK REQUIRED TO ACHIEVE READY FOR
PERFORMANCE TESTING.

 

20.2                           Limitation on Contractor’s Liability for Liquidated Damages.

 

A.                                   Delay Liquidated Damages.  Subject to Section 20.2C,
Contractor’s maximum liability to Owner for (i) RFCD Delay Liquidated Damages
is one percent (1%) of the Contract Price, as may be adjusted by Change Order
pursuant to Article 6 and (ii) Delay Liquidated Damages (including RFCD Delay
Liquidated Damages and Substantial Completion Delay Liquidated Damages) is ten
percent (10%) of the Contract Price in the aggregate, as may be adjusted by
Change Order pursuant to Article 6.

 

B.                                     Performance Liquidated Damages.  Subject to Section 20.2C, Contractor’s
maximum liability to Owner for:

 

1.                                       Sendout
Rate Performance Liquidated Damages is ten percent (10%) of the Contract Price
in the aggregate, as may be adjusted by Change Order; and

 

88

 

2.                                       Ship
Unloading Time Performance Liquidated Damages is two percent (2%) of the
Contract Price in the aggregate, as may be adjusted by Change Order;

 

3.                                       Performance
Liquidated Damages, collectively, is ten percent (10%) of the Contract Price in
the aggregate, as may be adjusted by Change Order.

 

C.                                     Exceptions to Limitations of Liability Under
Section 20.2.  Sections 20.2A
and 20.2B shall not be construed to limit Contractor’s obligation to complete
the Work for the compensation provided under this Agreement.

 

20.3                           Liquidated Damages In General.

 

A.                                   Liquidated Damages Not Penalty.  It is expressly agreed that Liquidated
Damages payable under this Agreement do not constitute a penalty and that the
Parties, having negotiated in good faith for such specific Liquidated Damages
and having agreed that the amount of such Liquidated Damages is reasonable in
light of the anticipated harm caused by the breach related thereto and the
difficulties of proof of loss and inconvenience or nonfeasibility of obtaining
any adequate remedy, are estopped from contesting the validity or
enforceability of such Liquidated Damages.

 

B.                                     Liquidated Damages as Exclusive Remedy.

 

1.                                       Delay
Liquidated Damages shall be Owner’s sole and exclusive damages and remedy, and
the sole and exclusive liability of Contractor, for delay as set forth in
Section 13.1, except Owner shall be entitled to also terminate this Agreement
for delay under Section 16.1A(iii) and, if so terminated under Section 16.1,
Owner is entitled to, as with respect to damages incurred by Owner for delay,
such delay damages set forth in Section 16.1B.

 

2.                                       Performance
Liquidated Damages shall be Owner’s sole and exclusive damages and remedy, and
the sole and exclusive liability of Contractor, for failure of the Facility to
achieve any of the Performance Guarantees, except as provided under Section 11.5.

 

C.                                     Payment of Liquidated Damages.  With respect to any Liquidated Damages that
accrue (whether Delay Liquidated Damages or Performance Liquidated Damages),
Owner shall invoice Contractor for such Liquidated Damages.  Contractor shall pay such Liquidated Damages
within ten (10) Days after Contractor’s receipt of such invoice.  To the extent Contractor does not pay such
Liquidated Damages within such ten (10) Day period, Owner may, at its option,
do one or more of the following: (i) withhold from Contractor amounts that are
otherwise due and payable to Contractor in the amount of such Liquidated
Damages and/or (ii) collect on the Letter of Credit in the amount of such
Liquidated Damages.  For the avoidance of
doubt, prior to exercising such right to withhold or collect on the Letter of
Credit, Owner shall not be required to provide the notice as set forth in Section
7.8.  As used in this Agreement, Liquidated
Damages are “paid” if and to the extent Owner exercises option (i) or (ii)
above for the collection of Liquidated Damages.

 

89

 

20.4                           Consequential Damages.  NOTWITHSTANDING ANY OTHER PROVISIONS OF THIS
AGREEMENT TO THE CONTRARY, NEITHER OWNER GROUP NOR CONTRACTOR GROUP SHALL BE
LIABLE UNDER THIS AGREEMENT OR UNDER ANY CAUSE OF ACTION RELATED TO THE SUBJECT
MATTER OF THIS AGREEMENT, WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING
NEGLIGENCE), STRICT LIABILITY, PRODUCTS LIABILITY, PROFESSIONAL LIABILITY,
INDEMNITY, CONTRIBUTION, OR ANY OTHER CAUSE OF ACTION FOR SPECIAL, INDIRECT,
INCIDENTAL OR CONSEQUENTIAL LOSSES OR DAMAGES, INCLUDING LOSS OF PROFITS, LOSS
OF USE, LOSS OF OPPORTUNITY, LOSS OF REVENUES, LOSS OF FINANCING, LOSS OR
INCREASE OF BONDING CAPACITY, COSTS OF OBTAINING OR MAINTAINING FINANCING, LOSS
OF GOODWILL, OR BUSINESS INTERRUPTION, OR DAMAGES OR LOSSES FOR PRINCIPAL
OFFICE EXPENSES INCLUDING COMPENSATION OF PERSONNEL STATIONED THERE (“CONSEQUENTIAL DAMAGES”) AND OWNER
SHALL RELEASE CONTRACTOR GROUP AND CONTRACTOR GROUP SHALL RELEASE OWNER GROUP
FROM ANY LIABILITY FOR SUCH CONSEQUENTIAL DAMAGES; PROVIDED
THAT THE EXCLUSION OF LIABILITY SET FORTH IN THIS SECTION 20.4 (I)
IS NOT INTENDED TO PREVENT CONTRACTOR FROM RECEIVING PROFIT TO THE EXTENT THAT
CONTRACTOR IS ENTITLED TO RECEIVE SUCH PROFIT UNDER THE PROVISIONS OF THIS
AGREEMENT AND (II) SHALL NOT APPLY (A) TO AMOUNTS ENCOMPASSED WITHIN LIQUIDATED
DAMAGES, (B) TO CONTRACTOR’S
INDEMNIFICATION OBLIGATIONS UNDER THIS AGREEMENT WITH RESPECT TO LOSSES SUFFERED
BY ANY THIRD PARTY OR, WITH RESPECT TO THE INDEMNIFICATION OBLIGATIONS SET
FORTH IN SECTION 17.2, MEMBERS OF THE CONTRACTOR GROUP OR ANY SUBCONTRACTORS OR
SUB- SUBCONTRACTORS, OR (C) TO OWNER’S INDEMNIFICATION OBLIGATIONS UNDER THIS
AGREEMENT WITH RESPECT TO LOSSES SUFFERED BY ANY THIRD PARTY OR, WITH RESPECT
TO THE INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 17.3, MEMBERS OF THE
OWNER GROUP OR ANY OTHER CONTRACTORS OF OWNER.

 

20.5                           Exclusive Remedies. 
Where a remedy specified in this Agreement is expressly stated to be a
Party’s sole remedy, it is intended that such remedy shall be the sole and
exclusive remedy of such Party for the matter in question, notwithstanding any
remedy otherwise available at law or in equity.

 

20.6                           Applicability.  EXCEPT TO THE EXTENT EXPRESSLY PROHIBITED BY
LAW, THE WAIVERS AND DISCLAIMERS OF LIABILITY, RELEASES FROM LIABILITY,
EXCLUSIONS, LIMITATIONS AND APPORTIONMENTS OF LIABILITY AND INDEMNITIES
EXPRESSED IN THIS AGREEMENT SHALL APPLY EVEN IN THE EVENT OF FAULT, NEGLIGENCE
(IN WHOLE OR IN PART), STRICT LIABILITY, BREACH OF CONTRACT OR OTHERWISE OF THE
PARTY RELEASED OR WHOSE LIABILITY IS WAIVED, DISCLAIMED, LIMITED, FIXED OR
INDEMNIFIED AND SHALL EXTEND IN FAVOR OF MEMBERS OF THE OWNER GROUP AND THE
CONTRACTOR GROUP.

 

20.7                           Term Limit.  WITH THE EXCEPTION OF ARTICLE 10, ARTICLE 19
AND SECTIONS 8.1, 17.1A, 17.1B, 17.1C, 17.1E, 17.4 AND 17.5 (AND TO THE EXTENT
THE FOLLOWING RELATE TO THE FOREGOING ARTICLES AND SECTIONS: SECTIONS 1.1,
17.8, 17.9 AND ARTICLE 18, ARTICLE 20 AND ARTICLE 21), NEITHER PARTY SHALL BE
LIABLE TO THE OTHER PARTY UNDER THIS AGREEMENT FOR ANY CLAIMS BROUGHT THREE (3)
YEARS OR MORE AFTER SUBSTANTIAL COMPLETION.

 

Article 21

MISCELLANEOUS PROVISIONS

 

21.1                           Entire Agreement. 
This Agreement, including the Attachments and Schedules

 

90

 

attached to and
incorporated into this Agreement, contains the entire understanding of the
Parties with respect to the subject matter hereof and incorporates any and all
prior agreements and commitments with respect thereto. There are no other oral
understandings, terms or conditions, and neither Party has relied upon any
representation, express or implied, not contained in this Agreement. General or
special conditions included in any of Contractor’s price lists, Invoices,
tickets, receipts or other such documents presented to Owner shall have no
applicability to Owner with respect to this Agreement.  Without limitation, this Agreement supersedes
in its entirety the Memorandum of Understanding, Technical Services Agreement, and any other agreements
between the Parties related to the Project.

 

21.2                           Amendments.  No
change, amendment or modification of the terms of this Agreement shall be valid
or binding upon the Parties hereto unless such change, amendment or
modification is in writing and duly executed by both Parties hereto.

 

21.3                           Joint Effort. 
Preparation of this Agreement has been a joint effort of the Parties and
the resulting document shall not be construed more severely against one of the
Parties than against the other.

 

21.4                           Captions.  The
captions contained in this Agreement are for convenience and reference only and
in no way define, describe, extend or limit the scope of intent of this
Agreement or the intent of any provision contained herein.

 

21.5                           Notice.  Any notice,
demand, offer, or other written instrument required or permitted to be given
pursuant to this Agreement shall be in writing signed by the Party giving such
notice and shall be hand delivered or sent by overnight courier, messenger,
facsimile or certified mail, return receipt requested, to the other Party at
the address set forth below.

 

A.                                   If
delivered to Owner:

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Facsimile: (713) 659-5459

Attn: Ed Lehotsky

 

with a copy to:

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Facsimile: (713) 659-5459

Attn: General Counsel

 

B.                                     If
delivered to Contractor:

 

Bechtel Corporation

3000 Post Oak Boulevard

 

91

 

Houston, Texas 77056

Facsimile: (713) 253-1610

Attn: C. Asok Kumar

 

with a copy to:

 

Bechtel Corporation

3000 Post Oak Boulevard

Houston, Texas 77056

Facsimile: (713) 235-3945

Attn: Principal Counsel

 

Each Party shall have the
right to change the place to which notice shall be sent or delivered by sending
a similar notice to the other Party in like manner.  Notices, demands, offers or other written
instruments shall be deemed to have been duly given on the date actually
received by the intended recipient.

 

21.6                           Severability.  The
invalidity of one or more phrases, sentences, clauses, Sections or Articles
contained in this Agreement shall not affect the validity of the remaining
portions of this Agreement so long as the material purposes of this Agreement
can be determined and effectuated.

 

21.7                           Assignment.  This
Agreement may be assigned to other Persons only upon the prior written consent
of the non-assigning Party hereto, except that Owner may assign this Agreement
to any of its Affiliates by providing notice to Contractor.  Furthermore, Owner may, for the purpose of
providing collateral, assign, pledge and/or grant a security interest in this
Agreement to any Lender without Contractor’s consent.  When duly assigned in accordance with the
foregoing, this Agreement shall be binding upon and shall inure to the benefit
of the assignee; provided that any assignment by
Contractor or Owner pursuant to this Section 21.7 shall not relieve Contractor
or Owner (as applicable) of any of its obligations or liabilities under this
Agreement.  Any assignment not in
accordance with this Section 21.7 shall be void and without force or effect,
and any attempt to assign this Agreement in violation of this provision shall
grant the non-assigning Party the right, but not the obligation, to terminate
this Agreement at its option for Default.

 

21.8                           No Waiver.  Any
failure of either Party to enforce any of the provisions of this Agreement or
to require compliance with any of its terms at any time during the term of this
Agreement shall in no way affect the validity of this Agreement, or any part
hereof, and shall not be deemed a waiver of the right of such Party thereafter
to enforce any and each such provisions.

 

21.9                           Governing Law.  This
Agreement shall be governed by, and construed in accordance with, the laws of
the state of Texas (without giving effect to the principles thereof relating to
conflicts of law).  The United Nations
Convention on Contracts for the International Sale of Goods shall not apply to
this Agreement and shall be disclaimed in and excluded from any Subcontracts
entered into by Contractor in connection with the Work or the Facility.

 

21.10                     Successors and Assigns. 
This Agreement shall be binding upon the Parties hereto,

 

92

 

their successors
and permitted assigns.

 

21.11                     Attachments and Schedules. 
All Attachments and Schedules shall be incorporated into this Agreement
by such reference and shall be deemed to be an integral part of this Agreement.

 

21.12                     Obligations.  Nothing
contained in this Agreement shall be construed as constituting a joint venture
or partnership between Contractor and Owner.

 

21.13                     Further Assurances. 
Contractor and Owner agree to provide such information, execute and
deliver any such instruments and documents and to take such other actions as
may be reasonably requested by the other Party that are not inconsistent with
the provisions of this Agreement and that do not involve the assumption of
obligations or liabilities greater than those provided for in this Agreement,
in order to give full effect to this Agreement and to carry out the intent of
this Agreement.

 

21.14                     Priority.  The
documents that form this Agreement are listed below in order of priority, with
the document having the highest priority listed first and the one with the
lowest priority listed last.  In the
event of any conflict or inconsistency between a provision in one document and
a provision in another document, the document with the higher priority shall
control.    This Agreement is composed of
the following documents, which are listed in priority:

 

A.                                   Change
Orders which expressly modify the terms of this Agreement or written amendments
to this Agreement;

 

B.                                     the
Articles of this Agreement; and

 

C.                                     Attachments
and Schedules to this Agreement.

 

21.15                     Restrictions on Public Announcements. 
Neither Contractor nor its Subcontractors or
Sub-subcontractors shall take any photographs of any part of the Facility,
issue a press release, advertisement, publicity material, financial document or
similar matter or participate in a media interview that mentions or refers to
the Work or any part of the Facility without the prior written consent of Owner;
provided that Contractor shall not be
required to obtain Owner’s prior written consent of Contractor’s issuance of a
press release to correct any errors made by Owner concerning Contractor in a
prior press release issued by Owner if Contractor first gives Owner five (5)
Days’ prior written notice of Contractor’s intent to issue such corrective
press release and an opportunity of Owner to correct such error within such
five (5) Day period.  Owner agrees to
cooperate with Contractor and provide to Contractor for review and comment a
copy of any press release that mentions or refers to Contractor prior to the
issuance of such press release; provided that Owner
shall not be required to obtain Contractor’s prior consent prior to the
issuance of such press release.  Contractor acknowledges and agrees that Owner
shall be required, from time to time, to make disclosures and press releases
and applicable filings with the SEC in accordance with applicable securities
laws, that Owner believes in good faith are required by Applicable Law or the
rules of any stock exchange.  If any such
disclosure, press release or filing includes any reference to Contractor, then
Owner shall provide as much notice as is practicable to Contractor to provide
it with an opportunity to comment; provided, however,
the final determination shall remain with Owner.  Contractor acknowledges that Owner shall be
required from time to time to

 

93

 

make filings in compliance with applicable securities laws, including a
copy of this Agreement.

 

21.16                     Potential Lenders, Potential Equity Investors and Equity Participants.

 

A.                                   Potential Lenders.  Owner shall provide to Contractor (i) the
identity of Potential Lenders that have signed confidentiality agreements with
Owner and (ii) a copy of the preliminary information memorandum or preliminary
offering circular distributed to such Potential Lenders and any final loan
agreements executed with Owner and such Potential Lenders.  As used herein, “Potential
Lender” shall mean any commercial bank, insurance company,
investment or mutual fund or other entity that is an “accredited investor” (as
defined in Rule 501 of Regulation D promulgated under the Securities
Act of 1933, as amended) and which extends credit, buys loans and is in the
business of lending as one of its businesses.

 

B.                                     Potential Equity Investors.  Prior to disclosure of any Work Product by
Owner to any potential equity investor in Owner in connection with the Project,
Owner shall (i) obtain Contractor’s written consent (such consent not to be
unreasonably withheld) to the description of the Work Product to be disclosed,
and (ii) obtain a waiver from such potential equity investor agreeing that it
is not relying upon such Work Product in making any investment decision in
connection with the Project and waiving and releasing any claim it may have
against Contractor or Contractor’s Affiliates on account of any such reliance
or purported reliance.  Owner
acknowledges and agrees that each potential equity investor shall be an “accredited
investor” within the meaning of Rule 501 of Regulation D promulgated
under the Securities Act of 1933, as amended.

 

C.                                     Equity Participants.  Owner’s successors, assigns and any future
recipient of any equity ownership in Owner shall be bound by the releases,
limitations on liability and other protections of Contractor set forth in this
Agreement, and Owner shall obtain the express written agreement of such equity
participants to be bound by such releases, limitations of liability and other
protections of Contractor.

 

21.17                     Foreign Corrupt Practices Act.  With respect to the performance of the Work,
Contractor shall, and shall cause each member of the Contractor Group to,
comply with all provisions of the Foreign Corrupt Practices Act of the United
States (15 U.S.C. § 78dd-1 and 2) and not to take any action that could result
in Owner or any of its Affiliates becoming subject to any action, penalty or
loss of benefits under such Act.  Owner
shall, and shall cause each member of the Owner Group to, comply with all
provisions of the Foreign Corrupt Practices Act of the United States (15 U.S.C.
§ 78dd-1 and 2) and not to take any action that could result in Contractor or
any of its Affiliates becoming subject to any action, penalty or loss of
benefits under such Act.

 

21.18                     Language.  This
Agreement and all notices, communications and submittals between the Parties
pursuant to this Agreement shall be in the English language.

 

21.19                     Counterparts.  This
Agreement may be signed in any number of counterparts and each counterpart
shall represent a fully executed original as if signed by each of the
Parties.  Facsimile signatures shall be
deemed as effective as original signatures.

 

21.20                     Federal Energy Regulatory Commission Approval.  Issuance of the NTP

 

94

 

pursuant to
Section 5.2B is contingent upon FERC issuing the FERC Authorization. In the
event FERC denies Owner’s application for the FERC Authorization or the content
of such FERC Authorization is not acceptable to Owner, then Owner shall not be
obligated to appeal therefrom.  In the
event FERC denies Owner’s application, then Owner may terminate this Agreement for
convenience in accordance with Section 16.2.

 

21.21                     Owner’s Lender.  
Contractor shall, on or before issuance of the NTP, enter into a
mutually acceptable form of acknowledgement and consent with the Collateral
Agent. Such acknowledgement and consent shall be substantially in the form of Attachment
AA.  Contractor shall cooperate in considering appropriate
and reasonable amendments to that form of direct agreement as such amendments
may be proposed by Lender or its counsel. Contractor acknowledges and
agrees that Owner’s issuance of the NTP is contingent upon obtaining project
financing in connection with this Project or other forms of financing.

 

21.22                     Independent Engineer. 
Contractor shall cooperate with
Independent Engineer in the conduct of his or her duties in relation to the
Facility and the Work, including the duties listed in Attachment CC.  No review, approval or disapproval by
Independent Engineer shall serve to reduce or limit the liability of Contractor
to Owner under this Agreement.

 

21.23                     Survival.  Subject to
Section 20.7, Article 6, Article 7, Article 9, Article 10, Article 12, Article
14, Article 15, Article 16, Article 17, Article 18 and Article 19, Article 20,
Sections 3.8, 3.13, 3.17, 4.9, 8.1, 8.2, 21.9, 21.16 and this Section 21.23
shall survive termination of this Agreement, in addition to any other
provisions which by their nature should, or by their express terms do, survive
or extend beyond the termination of this Agreement.

 

[Signature
Page Follows]

 

95

 

IN WITNESS WHEREOF, the
Parties have caused this Agreement to be executed by their duly authorized
representatives as of the Contract Date.

 

	
   

  	
  Owner:

  
	
   

  	
   

  
	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Sabine Pass LNG-LP,
  Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Charif Souki

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Charif Souki

  
	
   

  	
   

  	
  Title:

  	
  Chairman

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Contractor:

  
	
   

  	
   

  	
   

  
	
   

  	
  BECHTEL CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John M. Duty

  	
   

  
	
   

  	
  Name:

  	
  John M. Duty

  
	
   

  	
  Title:

  	
  Senior Vice President

  
						

 

96

 

ATTACHMENT A

 

SCOPE OF WORK AND DESIGN BASIS

 

 

Schedule A-1

 

SCOPE OF WORK

 

TABLE OF CONTENTS

 

	
  1.

  	
  SCOPE
  REQUIREMENTS

  	
   

  
	
  1.1

  	
  GENERAL INTRODUCTION

  	
   

  
	
  1.2

  	
  SUMMARY OF CONTRACTOR SCOPE

  	
   

  
	
  1.3

  	
  PRIORITY OF DOCUMENTS

  	
   

  
	
  2.

  	
  DESCRIPTION OF FACILITY

  	
   

  
	
  2.1

  	
  MARINE FACILITIES

  	
   

  
	
  2.2

  	
  LNG STORAGE FACILITIES

  	
   

  
	
  2.3

  	
  BOIL-OFF GAS AND
  VAPOR REMOVAL SYSTEM

  	
   

  
	
  2.4

  	
  LNG
  VAPORIZATION AND SENDOUT FACILITIES

  	
   

  
	
  2.5

  	
  POWER GENERATION

  	
   

  
	
  2.6

  	
  BUILDINGS AND STRUCTURES

  	
   

  
	
  2.7

  	
  CONTROL SYSTEMS

  	
   

  
	
  2.8

  	
  ELECTRICAL

  	
   

  
	
  2.9

  	
  FIRE PROTECTION

  	
   

  
	
  2.10

  	
  HAZARD DETECTION

  	
   

  
	
  2.11

  	
  SOIL IMPROVEMENT

  	
   

  
	
  2.12

  	
  SITE DEVELOPMENT AND
  CIVIL WORK

  	
   

  
	
  2.13

  	
  SETTLEMENT OF STRUCTURES

  	
   

  
	
  3.

  	
  MANAGEMENT AND SUPERVISION

  	
   

  
	
  3.1

  	
  OWNER MANAGEMENT PHILOSOPHY

  	
   

  
	
  3.2

  	
  PROJECT EXECUTION PLAN

  	
   

  
	
  3.3

  	
  OWNER OFFICE ACCOMMODATIONS

  	
   

  
	
  4.

  	
  ENGINEERING

  	
   

  
	
  4.1

  	
  DESIGN BASIS

  	
   

  
	
  4.2

  	
  APPLICABLE CODES AND
  STANDARDS

  	
   

  
	
  4.3

  	
  PROJECT ENGINEERING PLAN

  	
   

  
	
  4.4

  	
  ENGINEERING DESIGN

  	
   

  
	
  4.5

  	
  PRE-INVESTMENT

  	
   

  
	
  4.6

  	
  PROCUREMENT
  AND MATERIAL CONTROL

  	
   

  
	
  4.7

  	
  BID PACKAGES

  	
   

  
	
  4.8

  	
  TRANSPORTATION
  OF MATERIAL AND EQUIPMENT

  	
   

  
	
  4.9

  	
  SPARE PARTS

  	
   

  
	
  4.10

  	
  REIMBURSABLE
  PURCHASES (REIMBURSABLE CHANGE ORDERS)

  	
   

  
	
  4.11

  	
  WELDING

  	
   

  
	
  5.

  	
  SUBCONTRACTS

  	
   

  
	
  5.1

  	
  GENERAL

  	
   

  
	
  5.2

  	
  PROJECT SUBCONTRACT PLAN

  	
   

  
	
  5.3

  	
  LOCAL
  SUBCONTRACTORS AND SUB-SUBCONTRACTORS

  	
   

  
	
  5.4

  	
  BID PACKAGES

  	
   

  
	
  6.

  	
  CONSTRUCTION

  	
   

  
	
  6.1

  	
  GENERAL

  	
   

  
	
  6.2

  	
  SITE PREPARATION

  	
   

  
				

 

2

 

	
  6.3

  	
  SCAFFOLDING AND ACCESS
  EQUIPMENT

  	
   

  
	
  6.4

  	
  CRANEAGE AND LIFTING
  EQUIPMENT

  	
   

  
	
  6.5

  	
  MEDICAL FACILITIES

  	
   

  
	
  6.6

  	
  SANITATION

  	
   

  
	
  6.7

  	
  HOUSEKEEPING

  	
   

  
	
  6.8

  	
  TEMPORARY FACILITIES

  	
   

  
	
  6.9

  	
  HEALTH,
  SAFETY AND THE ENVIRONMENT (HSE)

  	
   

  
	
  6.10

  	
  INDUSTRIAL RELATIONS

  	
   

  
	
  6.11

  	
  SITE SECURITY

  	
   

  
	
  6.12

  	
  SITE MATERIALS HANDLING,
  CONTROL AND PRESERVATION

  	
   

  
	
  6.13

  	
  MATERIAL CONTROL PROCEDURE

  	
   

  
	
  6.14

  	
  MATERIAL MARKING

  	
   

  
	
  6.15

  	
  CONSTRUCTION UTILITIES

  	
   

  
	
  6.16

  	
  FIRST FILL MATERIALS

  	
   

  
	
  7.

  	
  QUALITY MANAGEMENT

  	
   

  
	
  7.1

  	
  QUALITY ASSURANCE
  REQUIREMENTS

  	
   

  
	
  7.2

  	
  PROJECT QUALITY PLAN

  	
   

  
	
  7.3

  	
  MONITORING BY OWNER

  	
   

  
	
  8.

  	
  COMMISSIONING AND START UP

  	
   

  
	
  8.1

  	
  INTRODUCTION

  	
   

  
	
  8.2

  	
  PROJECT COMMISSIONING PLAN

  	
   

  
	
  8.3

  	
  OPERATING AND
  MAINTENANCE MANUALS

  	
   

  
	
  8.4

  	
  PERFORMANCE TESTS

  	
   

  
	
  8.5

  	
  OPERATING TESTS

  	
   

  
	
  8.6

  	
  OWNER PARTICIPATION

  	
   

  
	
  8.7

  	
  OWNER OPERATOR TRAINING

  	
   

  
	
  8.8

  	
  VENDOR TRAINING

  	
   

  
	
  8.9

  	
  OPERATIONS
  ACTIVITIES PRIOR TO SUBSTANTIAL COMPLETION

  	
   

  
	
  8.10

  	
  OWNER’S RESPONSIBILITY

  	
   

  
	
  9.

  	
  PROJECT CONTROL

  	
   

  
	
  9.1

  	
  GENERAL

  	
   

  
	
  9.2

  	
  PROJECT CONTROLS PLAN

  	
   

  
	
  9.3

  	
  PROGRAM REPORTING
  - PLANNING NETWORK

  	
   

  
	
  9.4

  	
  CPM SCHEDULE

  	
   

  
	
  9.5

  	
  PROGRESS MEASUREMENT

  	
   

  
	
  9.6

  	
  MEETINGS;
  WEEKLY PROGRESS MEETINGS; MINUTES

  	
   

  
	
  9.7

  	
  MONTHLY PROGRESS REPORTS

  	
   

  
	
  9.8

  	
  QUARTERLY
  EXECUTIVE PROGRESS REPORTS

  	
   

  
	
  9.9

  	
  CONTRACTOR DELIVERABLES

  	
   

  
	
  10.

  	
  CONTRACTOR INTERFACES

  	
   

  
	
  10.1

  	
  FERC
  ACTIVITIES – DIVISION OF RESPONSIBILITY

  	
   

  
	
  10.2

  	
  FERC REQUIRED REPORTS

  	
   

  
	
  10.3

  	
  REQUIREMENTS
  OF DEPARTMENT OF HOMELAND SECURITY

  	
   

  
	
  10.4

  	
  VESSEL SECURITY PLAN

  	
   

  
	
  10.5

  	
  EXPORT GAS PIPELINES

  	
   

  
	
  10.6

  	
  EXISTING WELL

  	
   

  
	
  10.7

  	
  ENVIRONMENTAL MITIGATION

  	
   

  
	
  10.8

  	
  SABINE PASS LIGHTHOUSE

  	
   

  
	
  10.9

  	
  WT PROPERTY

  	
   

  
	
  11.

  	
  SCOPE OF LNTP

  	
   

  
	
  11.1

  	
  EARLY CHANGE ORDERS

  	
   

  
				

 

3

 

	
  11.2

  	
  PROJECT PLANNING ACTIVITIES

  	
   

  
	
  11.3

  	
  DETAIL ENGINEERING ACTIVITIES

  	
   

  
	
  11.4

  	
  PROCUREMENT ACTIVITIES

  	
   

  
	
  11.5

  	
  SUBCONTRACT ACTIVITIES

  	
   

  
	
  11.6

  	
  CONSTRUCTION ACTIVITIES

  	
   

  
	
  12.

  	
  EXCLUSIONS
  FROM CONTRACTOR SCOPE OF WORK

  	
   

  
	
  12.1

  	
  WORK BY OTHERS OR OWNER

  	
   

  
	
  12.2

  	
  WORK TO BE ADDED BY
  CHANGE ORDER

  	
   

  
	
  12.3

  	
  ITEMS
  POTENTIALLY TO BE ADDED BY CHANGE ORDER

  	
   

  
	
  12.4

  	
  EQUIPMENT AND MATERIAL
  PRICES

  	
   

  
	
  13.

  	
  REIMBURSABLE SCOPE OF
  WORK ITEMS

  	
   

  
	
  13.1

  	
  LISTING OF
  REIMBURSABLE WORK ITEMS

  	
   

  
	
  13.2

  	
  SUBMERGED COMBUSTION
  VAPORIZERS

  	
   

  
	
  13.3

  	
  HIGH PRESSURE SENDOUT
  COMPRESSOR

  	
   

  
	
  13.4

  	
  ADDITIONAL FERC
  REQUIREMENTS

  	
   

  
	
  13.5

  	
  ADDITIONAL LDEQ
  REQUIREMENTS

  	
   

  
	
  13.6

  	
  ADDITIONAL USACE REQUIREMENTS

  	
   

  
				

 

4

 

1.                                      SCOPE REQUIREMENTS

 

1.1                               General Introduction

 

This Scope of Work is intended to provide an overall description of
Contractor’s responsibilities for the design, engineering, procurement, manufacture,
management, construction, installation, testing, commissioning, start up,
initial operations, and Performance Testing, all on a turnkey basis, of the
Facility.

 

The Project will involve building a new LNG receiving, storage and
sendout Facility in a rural part of Cameron Parish, Louisiana.  The Facility will be designed to import,
store, and vaporize on average approximately 2,600 MMSCFD of LNG, for supply to
Natural Gas markets.  An Export Pipeline
(as defined in Section 2.4 below) will be built by others to transport the
Natural Gas to pipelines in the vicinity of the Project.

 

All obligations and responsibilities referred to in this Attachment
A are Contractor’s obligations and responsibilities, unless expressly
stated to be the obligation of Owner or a third Person.

 

References in this Attachment A to any “Section” or “Article”
shall mean the sections or articles of this Attachment A, unless express
reference is made to another section or article of the Agreement.  Any capitalized term used in this Attachment
A which is defined in the Agreement shall have the same meaning as defined
in the Agreement, unless a different meaning is expressly provided in this Attachment
A.

 

1.2                               Summary of Contractor Scope

 

Except for items and services expressly required to be identified in
Contractor’s Scope of Work as identified in Section 12 and Attachment U,
or any other provision of the Agreement to be provided by Owner, and subject to
the other provisions of the Agreement (including this Attachment A),
Contractor’s responsibilities for the design, engineering, procurement,
fabrication, manufacture, erection, installation, construction,
management,  inspection, repair
(including Corrective Work), testing (including Performance Tests), training,
pre-commissioning, commissioning and placing into service of the Facility and
the related component Equipment and Systems, and the required related labor and
materials, shall generally include:

 

a.               Detailed engineering
design of the Facility

 

b.              Development of
Contractor deliverables as described in Attachment B of the Agreement

 

c.               Supply of Equipment

 

d.              Mobilization and
Site establishment

 

e.               Management,
reporting and supervision of the Work

 

f.                 Construction and
installation of Facility

 

5

 

g.              Care, maintenance
and preservation of all Equipment.

 

h.              RFCD

 

i.                  Substantial
Completion

 

j.                  Pre-commissioning

 

k.               Commissioning

 

l.                  Initial
operation of the Facility up to Substantial Completion

 

m.            Performance Tests

 

n.              Performance of Corrective
Work in accordance with Article 12 of the Agreement

 

o.              Final Completion

 

1.3                               Priority of Documents

 

In the event of any conflict or inconsistency between this Scope of
Work (Attachment A, Schedule A-1), the Design Basis (Attachment A,
Schedule A-2) and the Preliminary Conceptual Engineering Documents and
Trends List (Attachment A, Schedule A-3), such conflict or
inconsistency shall be resolved in accordance with the following order of
priority, with the document having the highest priority listed first and the
one with the lowest priority listed last:

 

•                  Design
Basis (Attachment A, Schedule A-2)

 

•                  Conceptual
Engineering Documents and Trends List (Attachment A, Schedule A-3)

 

•                  This
Scope of Work (Attachment A, Schedule A-1)

 

6

 

2.                                      DESCRIPTION OF FACILITY

 

2.1                               Marine Facilities

 

LNG ships will off-load their LNG cargoes at two protected berths to be
constructed on the Site, each equipped with mooring systems and accessories for
safe berthing and de-berthing of LNG ships. 
The LNG ship berths will be located in a new marine basin, which will
include a maneuvering basin to turn and move the LNG ships into their
berth.  A new 1250 ft by 1100 ft
(approximate) marine basin will be dredged to a depth of at least 45 feet and
will be connected to the Sabine Pass Channel. 
The new marine basin and berths will be able to accommodate both
currently operating LNG ships and future ships, each of which will be capable
of holding up to 250,000 cubic meters (m3) of LNG.  The Facility will have three tugs, two line
handling boats, and facilities for their berthing at the Facility.

 

Onboard ship pumps will deliver LNG to low-pressure LNG storage Tanks
via stainless steel unloading arms and cryogenic piping.  Each berth will have one set of LNG unloading
arms.  Each set of unloading arms will
consist of four arms, two for unloading, one for vapor return and one for
either unloading or vapor return.  Space
for a fifth arm will be reserved on the platform.  All the arms will be equipped with powered
emergency release couplings (“PERCs”), swivel joints to provide the required
range of movement between the ship and the shore connections, and quick
connect/disconnect couplings to facilitate hook up to the LNG ship.  The unloading arms will be capable of being
drained into the LNG unloading lines prior to disconnecting.

 

The unloading arms will be connected to two parallel stainless steel
insulated LNG transfer lines for each berth. 
These four lines then will be manifolded together with valves into a
single pair of stainless steel insulated lines which will run along the main
piperack to transfer the LNG into the Tanks. 
The average LNG unloading rate will be 12,000 m3/hr (423,780
ft3/hr) from each ship, at approximately 75 pounds per square inch
gauge (psig) and -260oF.  Two
ships will be able to unload simultaneously; however, this will require reduced
unloading rates.

 

All mooring line hooks shall be specifically ordered with, and include
load cells for line tension monitoring, and quick release electrical and
mechanical mechanisms.  The load cells
and electrical quick release mechanism shall not be wired or energized for
service, but only reserved for future at a later date by the Owner.

 

Contractor is responsible for detail design for marine facilities based
on Owner supplied Shiner Moseley (“SM”) Marine Facilities Technical FEED
Documents.  The SM Technical FEED
Documents were developed from information and studies from navigation
simulations, mooring studies, local pilots, a LNG vessel captain, the USCG, and
conceptual information from vessel manufacturers.  In addition, Contractor is responsible for
confirming interfaces with marine facility including topside equipment and pipe
rack layout.

 

2.2                               LNG Storage Facilities

 

The LNG will be stored in three single containment insulated LNG
storage Tanks (Tank 1, Tank 2 and Tank 3). 
These Tanks will be designed and constructed so that the primary
container and an earthen impoundment dike will be capable of independently
containing the LNG.

 

7

 

Each Tank will be a double walled design and will consist of a 9%
nickel steel inner container; a carbon steel outer tank and a carbon steel
domed roof with an insulated aluminum deck over the inner container suspended
from the roof.

 

The space between the inner wall and the outer wall will be insulated
with expanded Perlite.  The Tank will be
supported on a piled foundation system. 
All piping into and out of the inner or outer containers will enter from
the top of the Tank.

 

The inner container will be designed and constructed in accordance with
the requirements of API Standard 620 Appendix Q.  The Tank system will meet the requirements of
NFPA 59A and 49 CFR Part 193.  The inner
tank will be “open top”, consisting of a shell and bottom.  The self-supporting roof of the outer tank
will contain gas and gas pressure produced by the stored product.  The Tanks will be designed taking into
consideration the seismic loads as well as the wind loads.

 

The Tank insulation system will be designed to limit the Tank Boil-Off
rate to a notional rate of no greater than 0.05% by volume per day of the Tank
contents at an ambient temperature of 90°F,
with the Tank full and in a steady-state condition. The notional Tank Boil-Off
rate will be documented through heat transfer calculations.

 

The annular space between the inner and outer tanks will be
approximately 36 inches wide and will be filled with Perlite and resilient
glass wool blanket insulation.  The
suspended deck will be insulated with glass wool blankets.  The Tank bottoms will be insulated with
cellular glass block insulation which is a load bearing insulation designed to
support the Tank and product weight.

 

Tank instrumentation will consist of resistance temperature detector (“RTDs”)
for sensing the Cool Down and foundation temperatures, tank gauging system that
will provide level temperature and density and a data acquisition system.  The Tanks will be protected with pressure and
vacuum relief systems.  A monorail crane
will be positioned for relief valve service.

 

Roof platforms will be provided to provide sufficient working space
around the pump wells and piping.  A
monorail type hoist will be provided for pump maintenance.

 

Four intank pump columns will be installed in each Tank for three pumps
and the fourth for a future spare intank pump. 
An additional single warehouse spare intank pump shall be provided.

 

Stairways and an emergency escape ladder will be provided to access the
roof platforms.  A stairway will be
provided to the inner tank bottom.

 

Spill protection of the Tank roof will extend over the edge of the roof
dome.

 

Exposed portions of carbon steel surfaces of the tank shell and roof
will be blasted and painted.  Stainless
steel, aluminum and galvanized surfaces will not be painted.

 

A general Tank lighting system will be provided.  Emergency lighting and aircraft warning
lights will be provided.  Each Tank will
be provided with a tank-grounding grid.

 

8

 

In addition to other testing during installation of the Tanks, partial
hydrostatic testing of the inner container will be performed in accordance with
API 620 Appendix Q.8.  Hydrotest water
will be discharged in accordance with Applicable Law upon completion of the
tests.  A pneumatic test of the outer
container will be performed in accordance with API 620 Appendix Q.8.

 

A settlement monitoring system will be provided to measure and record
inner and outer container movements during construction and hydrotest.  This construction monitoring will form the
basis for continued periodic monitoring once the Facility is in operation.

 

The Tanks will be equipped with density monitoring instrumentation to
detect stratification.  Facilities will
be provided to circulate the stored product so that if stratification begins to
develop, the Tank contents can be thoroughly mixed within each Tank and between
Tanks.

 

2.3                               Boil-Off Gas and Vapor Removal System

 

Small amounts of Natural Gas vapors will be produced within the system
during the handling of LNG from ship unloading through storage and other
transfers.  Boil-Off of LNG in the Tanks
will be caused by exposure of cryogenic equipment to ambient temperature and
other factors such as barometric pressure changes, pump heat input, and ship
flash vapor.

 

Excess vapor will be removed from the Tanks in order to control
pressure in the Tanks.  This vapor will
be compressed in the Boil-Off Gas compressors (“BOG Compressors”).  Fuel gas for the submerged combustion
vaporizers (“Submerged Combustion Vaporizers” or “SCVs”) will be taken from the
compressed gas and the remainder of the compressed gas will be mixed with part
of the LNG from the in-Tank pumps and condensed in the Boil-Off gas condenser
system (“BOG Condenser System”).

 

The BOG Compressors will be cryogenic reciprocating machines and will
have capacity to handle all Boil-Off vapors generated during all operating
modes.  The BOG Condenser drum will
separate the condensed gas from any non-condensed vapors.  Sendout pumps will take suction from the
bottom of the drum.  The drum will be
protected by diverting surplus vapor, if any, to the vapor space of the Tanks.

 

During ship unloading, a portion of the vapor from the Tanks will flow
to the vapor return blowers.  The blowers
will boost the pressure to overcome the pressure drop in the piping to the
ship.  Vapor must be returned to the ship
during unloading to make up for the volume of liquid pumped from the ship, in
order to maintain ship tank pressure.

 

2.4                               LNG Vaporization and Sendout
Facilities

 

Three vertical submerged pumps shall be provided in each Tank to
transfer LNG to the sendout pumps. The pumps will normally operate submerged
with about 1.5 psig tank pressure plus static head on the pump suction.  Discharge pressure shall be designed to be
approximately 100 psig. A complete “vaporization train” will consist of one
high-pressure LNG sendout pump and one SCV. 
Fifteen trains shall be designed and installed for use in normal
operations, and one spare train shall be installed.

 

9

 

The LNG sendout pumps will be multi-stage and seal-less with the motor
submerged in LNG.  The LNG sendout pumps
boost the pressure of the LNG sufficient for the vaporized Natural Gas to enter
the Export Pipelines after vaporization. 
Normal operation at design capacity will require fifteen pumps.

 

Submerged Combustion Vaporizers (“SCVs”) shall be provided to vaporize
the LNG.  Heat for vaporization will be
provided by burning a portion of the Boil-Off gas or vaporized gas.  Blowers will provide combustion air at a
pressure sufficient to force the combustion products up through a stainless
steel water basin where the combustion products will heat the water.  The water basin shall contain a bank of submerged
tubes through which the LNG passes.  As
the LNG passes through the tubes it will be heated by the warm bath and
vaporized.  Each vaporizer shall have its
own fired heater, basin and tube bundle.

 

The number of vaporization trains placed in service at any given time
will be based on Export Pipeline nominations. 
The vaporizers shall be designed, manufactured and installed in
accordance with NFPA 59A.

 

The vaporizers shall be designed to provide a 40°F
outlet temperature at design flow.

 

Each vaporizer shall also contain a separate coil to heat the fuel gas
required for one vaporizer.

 

Each vaporizer will have a burner management system and control panel
to allow safe start-up, operation, control and shutdown.  Selected instrumentation signals and alarms
from each vaporizer will be transmitted to the control room.

 

A programmable logic controller (“Programmable Logic Controller” or “PLC”)
shall be provided for SCV control and tied to the Facility distributed control
system (“Distributed Control System” or “DCS”) for monitoring and control.

 

The water in the basins will become acidic as it absorbs the carbon
dioxide from the combustion products. 
The water from the basins is neutralized in-situ using caustic before
overflowing to the firewater pond.

 

The facility emergency shutdown system (“Emergency Shutdown System” or “ESD”
system) shall be capable of initiating a shut down of the vaporizers.  The detection of low temperatures downstream
of each vaporizer will shut down the individual SCV to protect downstream
piping and Equipment from being subjected to lower than design
temperatures.  Other shutdowns of
individual vaporizer trains or groups of vaporizer trains will be determined
during detailed design.

 

Pipeline gas Btu control is not included in the Scope of Work.

 

Two vent stacks, one high pressure and the other low pressure, shall be
provided to vent process plant vapor releases to a safe location.

 

Two (2) 36-inch sendout lines (“Sendout Pipelines”) shall be
provided.  The sendout piping will be
stainless steel for approximately 300 ft and will run above ground, and
thereafter, the lines

 

10

 

will be carbon steel (coated and wrapped underground).  Takeoffs on the above ground lines shall be
included to provide fuel gas for onsite users (SCVs and power generation
facility).

 

A metering station shall be provided (“Master Sendout Meter Station”)
and will be fed from the two Sendout Pipelines, and will meter and record the
Natural Gas exports from the Facility. 
The outlet from the Master Sendout Meter Station will terminate at a
flange, which will be connected by Owner’s other contractor(s) to the Natural
Gas pipelines leaving the Facility (the “Export Pipelines”).  Ultrasonic type flowmeters (“Master Meter”)
shall be provided at the Master Sendout Meter Station to measure and totalize
the flow.

 

In addition to the export to the Export Pipeline, fuel gas shall be
consumed in the Facility for vaporization of the LNG in the SCVs and for power
generation.

 

The normal source of fuel gas for vaporizers will be from the discharge
of the BOG Compressors.  Alternate
supplies of fuel will be from downstream of the vaporizers.  The fuel is heated in separate coils in the
water bath of the SCVs.  Each vaporizer
shall have a coil designed to heat the amount of fuel required for that
vaporizer.

 

For power generation, fuel gas from the Sendout Pipelines shall be
heated and reduced in pressure from the Sendout Pipeline pressure to meet power
generating equipment requirements.  A
knockout drum shall be provided downstream of the pressure reducing valves.

 

2.5                               Power Generation

 

Five simple cycle gas turbine generators shall be provided, however
final size and quantity will depend on vendor selection.  Four shall be designed for use in normal
operation and the fifth will be the reserve. 
The generators shall be sized to provide sufficient power to operate the
Facility at maximum capacity.  Each
turbine generator shall be furnished with a remote control panel.

 

While the Facility is in normal operation, it is conceivable that one
of the gas turbine generators may trip if the Facility is at full load
exporting Natural Gas at the plant rating. 
The trip of any one gas turbine could cause overload on the system and
may lead to a total shutdown of all the gas turbine generators.  To avoid such a situation, a load shedding
philosophy would need to be followed by the Facility operator to shut down
sufficient number of process plant loads automatically to continue operation of
the power generating facilities as well as the process plant at part load.

 

A black start standby diesel generator shall be provided to supply all
essential loads during emergency and the cranking power and auxiliaries for a
gas turbine generator.

 

2.6                               Buildings and Structures

 

All buildings necessary for operation will be designed to maintain
structural integrity in a 150 mph wind speed, exposure “C” per ASCE 7.  Sanitary waste will be piped to a separate
packaged wastewater treatment unit.  Buildings and shelters as listed below,
sized in accordance with Trend T-SP-033, with layout in accordance with the
applicable documents listed in Schedule A-3 will be provided:

 

11

 

•                  The
control building will be a two-story, steel frame building with metal siding
and roofing.  The building will have an
I/O room, UPS/battery room, restrooms, offices , control room, data storage
room, and kitchen area.  The building
will have interior finishes, raised access floors for 1st and 2nd floors,
elevator, HVAC, lighting, building electrical, fire/smoke detection/protection,
and plumbing.

 

•                  The
administration building will be a one-story, steel frame building with built-up
roofing and brick façade.  The
administration building will have offices, restrooms, conference room, records
room, server room, copier/fax/printer room and kitchen area.  The building will include interior finishes,
HVAC, fire protection (sprinkler system), lighting, building electrical and
plumbing.

 

•                  The
warehouse/maintenance building will be a one-story prefabricated steel frame
building with metal roofing and siding.

 

•                  The
customs/marine buildings will be steel framed modular buildings with metal
siding and roofing. The jetty electrical buildings will be steel framed modular
buildings with metal roofing and siding. 
Two marine/customs buildings, one for each jetty, will be provided.

 

•                  A gate
house will be provided.

 

•                  Prefabricated
jetty electrical buildings will be provided.

 

•                  An
electrical substation.

 

•                  Shelters
with partial siding will be provided for BOG Compressors, vapor return blowers,
air compressors, firewater pumps, emergency standby diesel generator, and jetty
electrical equipment.

 

2.7                               Control Systems

 

Control and monitoring of the Facility will be performed by an
integrated Distributed Control System using operator interface stations located
in the control room.

 

An independent safety instrumented system (“Independent Safety
Instrumented System” or “SIS”) will be installed to allow the safe, sequential
shutdown and isolation of rotating Equipment, fired Equipment and Tanks.

 

Overall Facility control will consist of the following major functions:

 

1.               LNG ship unloading

 

2.               Tank pressure
control

 

3.               LNG vaporization
and sendout

 

4.               Plant SIS

 

12

 

5.               DCS Historian and
sequence of events recorder

 

A DCS will control the overall Facility operations and interface with
the following programmable logic controllers (“PLCs”):

 

1.               Jetty LNG ship
unloading PLCs

 

2.               Tank gauging data
acquisition systems

 

3.               SCVs

 

4.               Natural Gas
metering

 

5.               BOG Compressors

 

6.               Vapor return
blowers

 

7.               Nitrogen package
(provided by Owner)

 

8.               Instrument air
compressor and dryers

 

9.               Liquid caustic
system

 

10.         Gas turbine generators

 

An independent SIS will be installed to allow the safe, sequential
shutdown and isolation of rotating Equipment, fired Equipment, jetty areas, and
Tanks.  Emergency shutdowns will be
provided for each of the ship unloading systems, and for specific Equipment.  Design, construction and installation of SIS
will be compliant with ANSI/ISA-S84.01.

 

The Project will have a dedicated monitoring system for fire,
combustible gas, and low temperature spill monitoring.  Detection of fire and combustible gas will
produce alarms that will require manual intervention.  Low temperature spill detection in the
impoundment basins will automatically stop the pumps in the affected basin.

 

A closed circuit television system (“Closed Circuit Television System”
or “CCTV” system) will be installed to allow operators and security staff to
remotely view selected areas of the Facility from the control building and gate
house.

 

Communication between the various local control panels, remote I/O
cabinets and the control rooms will be achieved via a redundant fiber optic
industrial Ethernet ring.  This will
provide two-way, high-speed communication for control and display.

 

Operator workstations will be provided at three locations - the control
building and the two jetty electrical buildings.  Facility overview will be available at all
three locations, but Facility control will only be from the main control room
in the control building.

 

13

 

An independent SIS will be installed to allow the safe, sequential
shutdown and isolation of rotating equipment, fired equipment and LNG storage
facilities.  The SIS system will be
designed and installed to be compliant with the ANSI /ISA 84.01 standard.

 

A gas chromatograph will be provided in the Master Sendout Meter
Station for the temperature and pressure compensated gas outlet metering.  A second gas chromatograph will be provided
to sample incoming LNG from both berths plus vapor return (utilizing a Daniels
2510, or better, to analyze C1-C6+, N2, and CO2).

 

2.8                               Electrical

 

The Project will generate all the power required for the Facility for
startup, operation and maintenance.  No
permanent tie to the local power grid is included in the design.  Generated power from the combustion gas
turbine generators is designed to be at 13.8 kV.  Transformers will be designed to step down
the voltage from 13.8 kV to 4.16 kV, 480 V, and 240/120 V distribution levels.

 

The operating load of the Facility will be approximately 54 MVA.  Most of this load will consist of motors,
with the largest motors rated at approximately 2700 HP each.

 

A new substation will consist of generator switchgear building,
distribution transformers and substation switchgear building.

 

Electrical area classification will be according to the applicable
sections of NFPA 497 and API RP 500.  The
electrical materials and installation will be in accordance with the
requirements of the NEC. 15 kV, 5 kV and 480 Volt switchgears will be located
in switchgear buildings.

 

The electric motor drives in the Facility, except for emergency DC
motors in the power generation area will be rated for 4.16 kV, 460 V or 120
Volt depending on size.  The 4.16 kV and
480 Volt motor controllers/starters will be located in indoor motor control centers.

 

High-pressure sodium type lighting will be provided in process areas,
along roadways, Tank stairways, platforms, building exteriors, and jetties
perAPI-540, Table 4.

 

The grounding system design will be based on the ground fault
calculations.  Grounding system will
consists of ground grid and ground rods. 
Ground wells will be installed at the selected locations for testing of
the system.

 

A 40-kVA uninterruptible power supply (“UPS”) system will be provided
for the control room.  The system will
consist of an inverter, rectifier, static bypass switch, manual maintenance
bypass switch, 30 minute batteries, and distribution panel.

 

A 10-kVA UPS system will be provided at each jetty.  Each of these systems will be identical to
the 40 kVA, except for the size.

 

A DC UPS will be provided in the generator switchgear room to supply
power to the DC motor-driven lube oil pumps (120V DC) and emergency lighting in
enclosures (24V DC) on the combustion turbine generators.

 

14

 

Loads served by the UPS systems will include the DCS, SIS, unloading
controls at the jetty, and selected package unit control panels.

 

2.9                               Fire Protection

 

Fire protection for the Facility will involve several independent
systems, based on water, CO2, nitrogen, and chemical agents.  A firewater system will be provided to cover
the Facility (Refer to Drawings 12-0008A, 12-0008B, 12-0008C, 11-1010M,
11-0101N, 11-0101P referenced in Attachment A, Schedule A-3 for
details).  Carbon dioxide fire protection
system will be provided for the combustion turbine generator enclosures.  Portable dry chemical fire extinguishers will
be provided throughout the Facility and in all the buildings, including but not
limited to the control building, substations, generator breaker room, and the
process buildings.

 

The main components of the firewater system shall be a seven (7)
million gallon firewater pond, two (2) diesel driven firewater pumps, one motor
driven booster pump, one electric jockey pump, fire monitors, hydrants, hose
reels and underground piping.  Storm
water and SCV overflow water will maintain the level in the firewater pond,
which is designed to have a capacity well exceeding a 2-hour duration event.

 

Nitrogen snuffing will be provided at the tailpipe of each Tank
pressure relief valve.

 

Carbon dioxide fire extinguishing systems will be provided for the
combustion gas turbine generator enclosures. 
These systems will incorporate CO2 bottle racks, valving and
tubing.

 

Fireproofing, where required, will be used where structures or Equipment
cannot be protected by other means.

 

The Facility will include sirens, which will be audible in all
locations on the Site.  These sirens will
have a distinctive mode, for easy recognition between alarms and emergency
events.

 

2.10                        Hazard Detection

 

49 CFR Part 193 and NFPA 59A both require all areas which have a
potential for combustible gas concentrations of LNG or flammable refrigerant
spills to be monitored for combustible gas concentrations.

 

The Project will have dedicated monitoring systems for fire, combustible
gas, and low temperature LNG spillage detection, in accordance with 49 CFR Part
193 and NFPA 59A.  Flame detectors, smoke
detectors, gas detectors, and other sensors will be strategically located
throughout the Facility.  Audible and
visual alarms will be provided throughout the Facility area.  The monitoring system will be self-contained
as required by NFPA 59A.

 

All area monitors will be hardwired from the field device to a control
room panel.  Ultraviolet/infrared fire detectors
and gas detectors will be equipped with self-diagnostic circuitry to assure
proper device operation.

 

15

 

An independent SIS will be installed to allow the safe, sequential
shutdown and isolation of rotating Equipment, fired Equipment and Tanks.  The SIS will be totally separate from the
DCS, but will feed status information and data to the DCS for monitoring and
recording.

 

The ESD isolation points are identified on B&V drawing (Refer to Attachment
A, Schedule A-3), so in case a hazard is detected on a system, that system
shall be isolated to protect all other systems and facilities.

 

A CCTV system will be installed in accordance with B&V drawing
134882-0200-D12-0008B E to provide the operators and security staff with panoramic
and variable zoom views of the onshore and marine areas.  The control room and gatehouse will each have
camera controllers and overhead TV monitors. 
Approximately nineteen color TV cameras with zoom, pan and tilt
functions will be positioned at strategic locations throughout the Facility.

 

Instrumentation will be rated to meet the hazardous area
classifications.  In general,
instrumentation will be provided to meet National Electrical Code (NEC), Class
1, Group D Division 2, or Division 1.

 

Hazard detection for the Facility shall be designed based on the
following strategies:

 

•            Direct
visual monitoring;

 

•            Remote
visual monitoring through closed circuit television;

 

•            Centralized
alarm system; and

 

•            Emergency
shut down system.

 

In addition to visual monitoring, following detectors
shall be furnished:

 

•            Gas detectors

 

•            Low temperature detectors

 

•            UV/IR flame detectors

 

•            Smoke detectors

 

•            High temperature
detectors

 

A security monitoring system will be used to monitor the perimeter
security fence line and Facility entry gates. 
Visual monitoring will be provided for viewing of the following areas:

 

•            Main
gate;

 

•            Process
area;

 

•            Tanks;

 

16

 

•            East and
west jetty operations; and

 

•            Ship
manifold.

 

Two pull stations shall be provided on each Tank, one on the Tank
stairway and one on the roof platform for activation of audible and visual
alarms.

 

2.11                        Soil Improvement

 

Soils will be improved in the Tank diked area containing dredge spoils and
in other areas as required to achieve soil strength sufficient for constructing
the impoundment dikes, to support foundations for structures that are not
supported on piles, and to support other construction activities.

 

2.12                        Site Development and Civil Work

 

As described more fully in Schedule A-2, selected areas within
the proposed Site will be backfilled, leveled and graded for material laydown
and infrastructure to support the construction of the Facility.

 

The Facility shall be designed to provide drainage of surface water to
designated areas for disposal.  The storm
water collected by the spill impoundment collection system will drain to the
spill impoundment basins.  Pumps in the
spill impoundment basins will pump out the water collected and send the storm
water to the firewater pond, which ultimately discharges overflow water to a
drainage system leading to Sabine River.

 

A spill prevention control and countermeasures (“Spill Prevention
Control and Countermeasures” or “SPCC”) plan for the construction activities will
be developed and implemented in accordance with 40 CFR Parts 122 through 124.

 

Buildings, process equipment, and pipe rack foundations will be pile
supported foundations.

 

The Facility roads will consist of gravel surfaced or asphalt surfaced
roads.

 

The final paving will consist of gravel surfaced area, asphalt surfaced
area, or concrete paved surfaces.

 

2.13                        Settlement of Structures

 

LNG Tanks and all other heavy structures will be subject to short term
and long term settlement and differential settlement due to Subsurface Soil
Conditions at the Site.  These structures
shall be designed and constructed in accordance with Applicable Codes and
Standards and GECP, and also in accordance with the following requirements:

 

1.               All foundations
shall be designed and constructed to take into consideration
settlement and differential settlement based on the Subsurface Soil
Conditions as described in the Geotechnical Reports and the requirements in
this Section 2.13.

 

17

 

2.               Differential
settlements should be expected between pile-supported structures and adjacent
non-piled facilities or fill/improved areas. 
In addition to any differential settlement which may take place prior to
Substantial Completion, the engineering design and construction shall be such
that a six (6) inch differential settlement between pile-supported structures
and adjacent non-piled facilities or fill/improved areas which may occur from
Substantial Completion through the expected lifetime of the Facility will not
cause any Defects with normal monitoring and maintenance provided by Owner.

 

3.               Differential
settlement should be expected between each Tank and other adjacent
pile-supported structures such as piperacks. 
In addition to any differential settlement which may take place prior to
Substantial Completion, the engineering design and construction shall be such
that a six (6) inch minimum differential settlement between any Tank and
adjacent pile supported structures which may occur from Substantial Completion
through the expected lifetime of the Facility will not cause any Defects with
normal monitoring and maintenance provided by the Owner.

 

4.               The design and
construction of the LNG containment dikes shall be such that the Primary
Consolidation Settlement (as defined in “Foundation Analysis and
Design, Third Edition, by Joseph E. Boles, McGraw-Hill Book Company”)  shall  take place
prior to Substantial Completion, with the exception of any gaps in the dikes
which may be required for construction access by the Tank Subcontractor or
Contractor but which shall be completed or reinstated prior to Cool Down of
each Tank.  The LNG containment dikes
shall be maintained by Contractor through the Defect Correction Period and
restored, as necessary, in order to ensure that: (i) Primary Consolidation
Settlement of the completed dikes at the gaps described above is obtained; (ii)
the Design Basis capacity is satisfied; and (iii) settlement of the dikes will
not cause any Defects.

 

5.               Plant roads, where
applicable, shall be designed and constructed in accordance with the current
edition of Louisiana State Department of Highways and Public Transportation “Standard Specifications for Construction of Highways, Streets and
Bridges.”  After Substantial
Completion, roads will be maintained by Owner to repair normal wear and tear; provided, however, Contractor’s obligation to repair
Defective Work will not be relieved.

 

6.               If Subsurface Soil
Conditions encountered by Contractor during the performance of the Work are
materially different from the information regarding such Subsurface Conditions
as provided in the Geotechnical Report and the requirements in this Section
2.13, Contractor shall be entitled to a Change Order to the extent permitted
under Section 2.5B.2 of the Agreement.

 

18

 

3.                                      MANAGEMENT AND SUPERVISION

 

3.1                               Owner Management Philosophy

 

To effect the necessary
control of the interfaces between Owner and Contractor, and to facilitate
prompt and accurate communications between Owner and the Contractor, Owner
Representative will utilize a team of Owner’s personnel or consultants, which
will be resident in the Contractor’s Houston home office during design and
procurement phase, and at Site during construction through commissioning,
startup, initial operations, and until Substantial Completion.

 

3.2                               Project Execution Plan

 

Without prejudice to any other provision of this Attachment A or
the Agreement which sets out specific requirements for any of the plans or
documents listed below, within sixty (60) Days after Notice to Proceed,
Contractor shall submit to Owner for review Contractor’s project execution plan
(“Project Execution Plan”), which shall address, summarize, and provide a
schedule for development and finalization of the following plans, procedures,
and other documents.

 

a.               Project objectives

 

b.              Project management

 

c.               Project Engineering
Plan

 

d.              Document Management
Plan

 

e.               Project Controls
Plan

 

f.                 Project Procurement
Plan

 

g.              Revisions to
Attachment G, if any

 

h.              Document control
plan

 

i.                  Communications
plan

 

j.                  Subcontractor
list

 

k.               Project Subcontract
Plan

 

l.                  HSE Plan

 

m.            Interface management
plan

 

n.              Project Quality Plan

 

o.              Project Construction
Plan

 

19

 

p.              Project Commissioning
Plan

 

q.              Performance Test Procedures

 

r.                 Labor relations
plan

 

s.               Management of
change plan

 

t.                 Operations
training plan

 

u.              Interim operations
plan

 

3.3                               Owner Office Accommodations

 

All security, furnishings, electrical power and other temporary
utilities, lighting, telephones, facsimile, and high speed internet access
associated with the office accommodation below shall be provided by the
Contractor.  This shall include the
telecommunications line rentals, from Notice to Proceed until thirty (30) Days
after Substantial Completion. 
International long distance calls will be reimbursed to Contractor as
Reimbursable Costs.  Owner will supply
computers to Owner personnel:

 

The Contractor shall provide office accommodation for:

 

•                  Up
to a peak of six (6) Owner personnel at Contractor’s Houston home office,
including two reserved covered parking spaces, all for a 24-month period
commencing with LNTP.

 

•                  Up
to total ten (10) Owner personnel at Site at the peak of the construction
activities, including two reserved parking spaces for 30-months period.

 

4.                                      ENGINEERING

 

4.1                               Design Basis

 

Owner shall be responsible for providing those items of information
defined as “Rely Upon” in the Design Basis included in Schedule A-2 of
this Attachment A and for providing to Contractor the information or
items specified in Attachment U, subject to Contractor’s obligation to
provide information to Owner as specified in Attachment U.  In accordance with Section 4.8 of the Agreement,
Owner shall remain fully responsible for the accuracy, completeness and
sufficiency of such information..

 

All other information constituting the Design Basis or otherwise
required for performance of the Work shall be provided or developed by
Contractor, as applicable, and Contractor shall be fully responsible for the
accuracy, correctness and completeness thereof, and the provisions of Section
2.5A of the Agreement shall apply with respect to all such information provided
or developed by Contractor or otherwise required for performance of the Work
(other than the information, as specified in the preceding sentence, which is
the responsibility of Owner).

 

20

 

4.2                               Applicable Codes and Standards

 

The Applicable Codes and Standards include: (i) 49 CFR Part 193, 33 CFR
Part 105, 33 CFR Part 127, NFPA 59A; (ii) any codes and standards specifically
mentioned in any provision of the Agreement or the Attachments as applicable to
the Work; (iii) any codes or standards set forth or listed in any document
listed in Schedule A-3; and (iv) those codes and standards of the
following standards organizations and other generally accepted practices,
methods, techniques and standards employed by the international LNG industry
constituting GECP, as specifically identified through detailed engineering:

 

•                  AASHTO,
American Association of State Highway and Transportation Officials

 

•                  ACI,
American Concrete Institute

 

•                  AFBMA,
Anti-Friction Bearing Manufacturers Association

 

•                  AGA,
American Gas Association

 

•                  AGMA,
American Gear Manufacturers Association

 

•                  ASA,
Acoustical Society of America

 

•                  ARI,
Air Conditioning and Refrigeration Institute

 

•                  AICHE,
American Institute of Chemical Engineers

 

•                  AISC,
American Institute of Steel Construction

 

•                  ANSI,
American National Standards Institute

 

•                  API,
American Petroleum Institute

 

•                  ASME,
American Society of Mechanical Engineers

 

•                  ASNT,
American Society for Non-Destructive Testing

 

•                  ASTM,
American Society for Testing and Materials

 

•                  ASCE,
American Society of Civil Engineers

 

•                  ASHRAE,
American Society of Heating, Refrigeration and Air-conditioning Engineers

 

•                  AWWA,
American Waterworks Association

 

•                  AWS,
American Welding Society

 

•                  CINI,
Insulation for Industries

 

21

 

•                  CMAA,
Crane Manufacturers Association of America

 

•                  CRSI,
Concrete Reinforcing Steel Institute

 

•                  CSI,
Construction Specifications Institute

 

•                  EJMA,
Expansion Joint Manufacturers Association

 

•                  FCI,
Fluid Control Institute

 

•                  FM,
Factory Mutual

 

•                  GPA,
Gas Processors Association

 

•                  HFES,
Human Factors and Ergonomics Society

 

•                  IBC,
International Building Code

 

•                  ICEA,
Insulated Cable Engineers Association

 

•                  IESNA,
Illuminating Society of North America

 

•                  IEEE,
Institute of Electrical and Electronics Engineers

 

•                  ISA,
International Society for Measurement and Control

 

•                  MSS,
Manufacturer’s Standardization Society of the Valve and Fitting Industry

 

•                  NACE,
National Association of Corrosion Engineers

 

•                  NEMA,
National Electrical Manufacturers Association

 

•                  NFPA,
National Fire Protection Association

 

•                  NFSA,
National Fire Sprinkler Association

 

•                  OCIMF,
Oil Companies International marine Forum

 

•                  OSHA,
Occupational Safety and Health Administration

 

•                  PCI,
Precast/Prestressed Concrete Institute

 

•                  PIP,
Process Industries Practices, Piping

 

•                  SAE,
Society of Automotive Engineers

 

•                  SIGTTO,
Society of International Gas Tanker and Terminal Operators

 

22

 

•                  SMACNA,
Sheet Metal and Air Conditioning Contractors National Association

 

•                  SSPC,
Steel Structures Painting Council

 

•                  TEMA,
Tubular Exchanger Manufacturers Association

 

•                  UFC,
Uniform Fire Code

 

•                  UL,
Underwriters Laboratories

 

4.3                               Project Engineering Plan

 

Contractor shall produce a detailed project engineering plan (“Project
Engineering Plan”) for review by Owner within sixty (60) Days after Notice to
Proceed.  The Project Engineering Plan
will provide a summary of the procedures, plans, and execution methodologies to
be used by Contractor to develop the engineering design in accordance with the
Applicable Codes and Standards and the requirements of the Agreement.

 

4.4                               Engineering Design

 

4.4.1                     General

 

In addition to any other engineering requirements specified in Attachment
A or any other provision, Attachment or Schedule of the Agreement, the
following services, Drawings, and Specifications, as a minimum, shall be
provided by Contractor in respect of all engineering disciplines during
engineering of the Facility:

 

a.               Completing the
engineering design documents listed in Attachment A, Schedule A-3, which
define the preliminary design of the Facility developed or verified by
Contractor before the Contract Date

 

b.              Developing new
Drawings sufficient for procurement of materials, installation, construction,
manufacture, fabrication, commissioning, startup, testing, operation and
maintenance of the Facility

 

c.               Preparation of
Equipment data sheets

 

d.              Preparation of
Drawings for the Facility and related Drawing list

 

e.               Preparation of
engineering material requisitions and purchase requisitions, and amendments as
necessary up to record status

 

f.                 Technical
evaluation for all Major Equipment

 

g.              Review of vendor
data, Drawings and other documentation for engineered Equipment

 

h.              Detailed material
take-offs and monitoring of material changes for all disciplines

 

23

 

i.                  Development of
acceptance test requirements for all Major Equipment

 

j.                  Development and
implementation of a plan for witnessing of factory acceptance tests at vendor’s
shops for all Major Equipment

 

k.               Drawings control,
vendor data and documentation control using a computer database utilizing
Contractor’s document control procedure

 

l.                  Review of vendor’s
recommended spares for Equipment and prepare final recommended Operating Spare
Parts List in accordance with Section 3.4 of the Agreement

 

m.            Development of
technical documents for Subcontracts

 

n.              Provision of
engineering support for procurement, construction and commissioning, including
assistance to Subcontractors in the interpretation of technical requirements
and Drawings

 

o.              Preparation of mechanical
catalogues and vendor data books

 

p.              Provision of all
Record Drawings and Specifications

 

q.              Tie-in Drawings

 

r.                 Development of Equipment
lists, instrument index, line lists, material lists, and supplier lists

 

4.4.2                     Process and
Systems

 

Contractor shall be responsible for developing the following Drawings
and Specifications related to the process and process systems:

 

a.               Process flow
diagrams with heat and material balances

 

b.              Piping and
instrument drawings (“P&IDs”)

 

c.               Equipment list

 

d.              HAZOP review of
P&ID’s, prior to issue for design. 
Any subsequent design changes on P&ID’s will be integrated into the
design prior to finalization of design. 
Safety review of changes to Drawings after HAZOP will be done as part of
a project management of change procedure.

 

e.               Contractor shall
conduct a safety integrity level (“SIL”) meeting to define integrity levels of
critical control and safety systems.

 

4.4.3                     Plant Layout and
Piping Design

 

Contractor shall be responsible for developing the following Drawings
and Specifications related to the piping and piping systems:

 

24

 

a.               Plot plans, Equipment
location plans, underground piping plans, key plans

 

b.              Electronic 3-D model

 

c.               Piping isometric
Drawings

 

d.              Service class index

 

e.               Pipe support design
Drawings

 

f.                 Pipe stress
analysis

 

g.              Piping
Specifications

 

4.4.4                     Mechanical Design

 

Contractor shall be responsible for developing the following Drawings
and Specifications related to the mechanical design of vessels, Tanks, heat
exchangers, rotating Equipment, fired Equipment, special Equipment, and
packaged Equipment:

 

a.               Equipment data
sheets

 

b.              Equipment
Specifications

 

4.4.5                     Electrical Design

 

Contractor shall be responsible for developing the following Drawings
and Specifications related to the electrical power supply and distribution:

 

a.               Electrical
equipment data sheets

 

b.              Specifications for
electrical Equipment and bulks

 

c.               One-line diagrams

 

d.              Electrical area
classification Drawings

 

e.               Substation design

 

f.                 Wiring layouts
and plans

 

g.              Closed circuit TV, Facility
communications, electrical security systems, and other electrical systems

 

4.4.6                     Civil /
Structural / Architectural Design

 

Contractor shall be responsible for developing the
following Drawings and Specifications:

 

a.               Foundations design
basis

 

25

 

b.              Buildings layout and
specifications

 

c.               Grading / drainage
plan

 

d.              Foundation designs

 

e.               Piling designs

 

f.                 Drainage, roads,
and buildings

 

4.4.7                     Materials

 

Contractor shall be responsible for developing the following Drawings and
Specifications related to materials selection, engineering, and applications
technology:

 

a.               Material selection guide

 

b.              Corrosion control Specifications

 

c.               Painting and
coating Specifications

 

d.              Insulation systems Specifications

 

4.5                               Pre-investment

 

The following pre-investment items are covered in the Scope of the
Work:

 

1. Sendout line size is increased from 24” to 36” (shown on P&ID
D01-0050)

 

2. Increase rack width to each berth to accommodate an additional 30”
line

 

3. Cryogenic tie-ins (shown on P&ID D01-0016)

 

4. In-tank pump, warehouse spare

 

5. Electrical building 20% spare space

 

6. Installed spare to accommodate additional 20% I/O

 

7. Space only for a total of four additional SCVs and sendout pumps,
two in each bank

 

8. Space for fourth LNG unloading arm at each berth

 

9. Space only for one each additional blower, BOG Compressor and air
compressor

 

10. Flanged spool piece for BTU control

 

26

 

4.6                               Procurement and Material Control

 

4.6.1                     General

 

The Project procurement plan
will provide a summary of the procedures, plans, and execution methodologies to
be used by Contractor for procuring Equipment, materials, goods and services
within the Scope of Work (the “Project Procurement Plan”).

 

4.6.2                     Project
Procurement Plan

 

Contractor shall produce a Project Procurement Plan for review by Owner
within ninety (90) Days after Notice to Proceed, and Owner will provide review
comments within ten (10) Business Days after receipt.

 

•            Inspection

 

•            Expediting

 

•            Supplier
quality reports

 

•            Technical
requirement compliance

 

•            Material
control, marking, and certification

 

•            Packing,
consolidation, importing

 

•            Transportation,
handling, and storage

 

•            Warranties
and guarantees

 

•            Vendor
servicemen

 

4.6.3                     Local
Suppliers

 

Contractor shall give due consideration to local companies to provide
materials and services, provided they are competitive in terms and price,
proven quality, experience, expertise, service and delivery.  The procedures shall indicate how Contractor
intends to ensure appropriate consideration of local suppliers.

 

4.7                               Bid Packages

 

(Refer to Section 2.4 of the Agreement)

 

Contractor shall be responsible for preparing and issuing bid packages
or requests for proposals for materials, equipment and services within the Scope
of Work where required.  Contractor shall
receive the bids and perform the formal bid evaluations.

 

27

 

4.8                               Transportation of Material and
Equipment

 

Contractor shall
be fully responsible for the packaging, transportation, importation, and
customs clearance of all Equipment to and from the Site, including all costs
associated with such transportation. To the extent Equipment is transported to
the Site by vessels, Contractor shall only use vessels that are acceptable to
the marine cargo insurance providers.

 

4.9                               Spare Parts

 

(Reference Section 3.4 of the Agreement)

 

4.10                        Reimbursable Purchases (Reimbursable
Change Orders)

 

In the event that Owner specifically requests Contractor, by way of
Change Order in accordance with Article 6 and Schedule D-4 of the Agreement,
to purchase an item which is not included in the Scope of Work on a
cost-reimbursable basis (a “Reimbursable Change Order”), the provisions of this
Section 4.10 shall apply to such reimbursable purchases.

 

4.10.1              Inquiries

 

For reimbursable purchases valued over US$1.0 million, to be purchased
by Contractor under a Change Order, Contractor shall ensure all inquiries
request sufficient information to support a complete commercial and technical
evaluation, including nearest parts and service location.  Inquiries shall be issued to
vendors/subcontractors on the approved Subcontractors’ list set out in Attachment
G.  A sufficient number of qualified
suppliers/subcontractors shall be invited to bid to ensure receipt of at least
three (3) bona fide bids for reimbursable purchases unless otherwise agreed by
Owner.

 

Contractor shall prepare all inquiries to insure that the inquiry
documentation is comprehensive and complete with all Drawings so that
competitive bids received will require a minimum amount of conditioning.

 

4.10.2              Bid Evaluations

 

Contractor shall issue a complete technical and commercial bid
evaluation with recommendations for award to Owner for review and agreement,
prior to any award.  Owner technical and
administrative personnel will work with Contractor’s staff in bid evaluations
for all purchases of Equipment and other items on a cost-reimbursable basis.

 

4.10.3              Purchase Orders

 

Following agreement of the vendor list and bid evaluation, Contractor
shall issue a purchase order to the selected vendor.  The purchase order shall include and confirm
all factors considered in the inquiry and technical bid evaluation, and other
relevant information and requirements.

 

28

 

4.10.4              Communications

 

Contractor shall give Owner in writing, at least ten (10) Business Days
advance notice of proposed technical and logistics meetings and commercial
negotiations for reimbursable items between Contractor and vendors, together
with date, time and subject of the meeting. 
Owner will indicate whether or not it will participate.

 

4.11                        Welding

 

The Contractor shall prepare and/or review all welding procedures, non
destructive evaluation procedures and non destructive evaluation reports
including radiographs for compliance to applicable standards for welding and
testing.  All cryogenic stainless steel
piping that contains flammable fluids, except drains and vents, shall have 100%
radiographic testing of all circumferential welds.  Cryogenic stainless steel piping that
contains flammable fluids for drains and vents does not require radiographic
testing of circumferential welds if operating pressure is less than 20% of
specified minimum yield stress, otherwise it shall have 100% radiographic
testing of all circumferential welds. 
Carbon steel piping that contain flammable fluids and operates above -20oF,
except fuel gas piping, shall have radiographic testing of 30% of each day’s
circumferential welds.  Fuel gas piping
shall be installed in accordance with NFPA 54.

 

The Contractor shall qualify all weld procedures, non destructive
evaluation procedures, welder and non destructive personnel qualifications in
accordance with ANSI B31.3 unless otherwise agreed by Owner in writing.  The performance of these qualifications,
including testing and laboratory analysis shall be the responsibility of the
Contractor.

 

29

 

5.                                      SUBCONTRACTS

 

5.1                               General

 

Subject to the provisions
of Sections 2.3 and 2.4 of the Agreement, Contractor shall engage
Subcontractors as required to perform the Work and carry out Contractor’s
obligations under the Agreement.

 

5.2                               Project Subcontract Plan

 

Contractor shall produce
a detailed Subcontract plan (“Project Subcontract Plan”) for review by Owner
within ninety (90) Days after Notice to Proceed.  The Project Subcontract Plan will provide a
summary of the procedures, plans, and execution methodologies to be used by
Contractor for bidding, evaluating, awarding, inspection, progress monitoring,
technical requirement compliance, material controls, and expediting of
Subcontracts.

 

5.3                               Local Subcontractors and
Sub-subcontractors

 

Contractor shall give due
consideration to local companies to provide materials and services, provided
they are competitive in terms and price, proven quality, experience, expertise,
service and delivery.  The Project
Subcontract Plan shall indicate how Contractor intends to ensure appropriate
consideration of local subcontractors.

 

5.4                               Bid Packages

 

Reference Section 2.4 of the Agreement.

 

Contractor shall be responsible for preparing and issuing bid packages
or request for proposals for Subcontracts.

 

30

 

6.                                      CONSTRUCTION

 

6.1                               General

 

Contractor shall produce a detailed construction plan (“Project
Construction Plan”) for review by Owner within ninety (90) Days after Notice to
Proceed.  Owner will provide comments
within ten (10) Business Days following receipt. The Project Construction Plan
will provide a summary of the procedures, plans, and execution methodologies to
be used by Contractor for all management, controls, labor, supervision, consumables,
tools, plant and Equipment necessary to construct, mechanically complete, test,
and pre-commission the Facility.  The
Project Construction Plan will address the following:

 

•            Construction
procedures

 

•            Policies,
rules and regulations for:

 

•                  HSE

 

•                  Personnel identification

 

•                  Access to Site

 

•                  Firearms, drugs, alcohol, animals,
etc.

 

•                  Access Equipment

 

•                  Construction Permits

 

•                  Parking

 

•                  Vehicular access

 

•                  Personnel orientation

 

•                  Construction plant and Construction
Equipment

 

•            Construction
methodology

 

•            Demolition

 

•            Scaffolding
and access equipment

 

•            Temporary
roads

 

•            Work force
training

 

•            Industrial
relations

 

31

 

•            Public
relations

 

•            Security

 

•            Transportation
of Equipment

 

•            Construction
dock

 

•            Utilities,
chemicals, lubricants

 

•            Construction
communication procedures

 

•            First
fills

 

•            Punchlists

 

•            Close
out

 

•            Demobilization

 

6.2                               Site Preparation

 

Contractor shall be responsible for carrying out Site preparation Work
(Refer to B&V Drawing 01-0005A and other applicable documents in Attachment
A, Schedule A-3), including:

 

•            Removal
of all vegetation

 

•            Soils
improvement

 

•            Temporary
and permanent roads

 

•            Top soil
removal

 

•            Temporary
and permanent drainage

 

6.3                               Scaffolding and Access Equipment

 

The Contractor shall provide a safe means of access to the Work at all
times, including for purposes of inspections by Owner.  Scaffolding must be substantial and appropriately
designed for the job.  The Contractor
shall keep adequate records to demonstrate a system of regular inspection of
scaffolds, by appropriately qualified personnel.  Records shall also be maintained of
calculations performed for load bearing scaffolds.  Tags with inspection, and expiration shall be
prominently displayed on all scaffolding.

 

6.4                               Craneage and Lifting Equipment

 

The Contractor shall only employ craneage and lifting equipment that
has been tested and which are fit for purpose. 
All crane operators and riggers shall be adequately trained and must be
able

 

32

 

to demonstrate that they hold the appropriate certification.  The Contractor shall keep records of tests
and certification of all lifting equipment, craneage and operators employed in
the Work.  Contractor shall comply with
its internal rigging procedure MPT-4MP-T81-01903 for all lifting
operations.   Contractor will submit
rigging plans for lifts exceeding 50-tons, multiple crane lifts or lifts which
are considered critical for review by Owner or Owner’s designee.

 

6.5                               Medical Facilities

 

The Contractor shall provide provisions for suitable first-aid
facilities which shall be available to all personnel at the Site, including
those employed by Owner, Subcontractors and visitors.

 

The first-aid facilities, as a minimum, shall include a fully equipped
first-aid room capable of treating injuries that can be anticipated on a
construction site.  Consideration shall
be given for at least one qualified EMT or nurse on duty during the hours when
construction Work is in progress at the Site. 
The Contractor shall also provide a program of training for first-aid
personnel among the workforce and establish an emergency response team, drawn
from the medical and workforce first-aid personnel, to deal with serious on
Site accidents.

 

The Contractor shall produce for review by Owner within thirty (30) Days
after Notice to Proceed, a plan detailing how emergency medical treatment will
be administered.  Such plan shall take
into account capabilities of local hospital and medical facilities.

 

6.6                               Sanitation

 

The Contractor shall provide adequate washing and latrine facilities
for its workforce and for visitors permitted on the Site.  These facilities shall be cleaned,
disinfected, stocked with supplies and maintained regularly at all times and
the disposal of sanitary waste shall conform to statutory requirements.

 

6.7                               Housekeeping

 

The Contractor shall provide suitable receptacles and services to
ensure that all scrap materials, debris and spoil generated by Contractor’s
construction activities, are collected regularly and properly disposed of.  Disposal of such materials outside the Site
shall be to a properly licensed land fill or environmental waste subcontractor,
in accordance with Applicable Law and Permits.

 

As soon as practicable after the completion of all Punchlist items,
Contractor shall remove all Construction Equipment, construction trailers and
other temporary facilities, and all other items brought onto the Site by
Contractor, Subcontractors or Sub-subcontractors which are not the property of
Owner, and remove from the Site and properly dispose of all scrap materials,
debris and spoil.  Contractor shall allow
all temporary construction laydown areas to naturally revegetate, unless
such areas are designated for wetland mitigation or other use by Owner that
does not require such restoration.

 

6.8                               Temporary Facilities

 

Until Substantial Completion, Contractor shall provide all temporary
facilities necessary for performance of the Work.  All temporary buildings, piping, cabling,
communications equipment,

 

33

 

storage facilities, fencing, gates, gas detection equipment, utilities,
and the like shall be removed on Substantial Completion.

 

6.9                               Health, Safety and the Environment (HSE)

 

(Refer to Attachment J)

 

6.10                        Industrial Relations

 

The Contractor shall prepare and provide to Owner within ninety (90) Days
following Notice to Proceed, its policies and plans for managing industrial
relations at the Site, for review by Owner. 
Such policies and plans shall cover working hours, right to work
policies, working patterns,  shifts,
disputes procedure, welfare facilities (catering, sanitary, wet weather gear,
protective clothing etc.), training, wet weather working, holidays and any
other relevant matters.

 

The Contractor shall report all disputes or potential disputes
involving Contractor’s or Subcontractors’ employees to Owner Representative as
soon as practicable after they occur. 
The Contractor will be expected to take a pro-active role in managing
industrial relations among such employees at the Site.

 

6.11                        Site Security

 

The Contractor shall be responsible at all times for security at the
Site until Substantial Completion. 
Adequate fencing and security devices shall be provided and maintained
to prevent unauthorized access to the Site and theft or damage.  The Contractor shall employ sufficient
security personnel to police the Site entrances, perimeter fencing and secure
areas at all times and to carry out random searches of vehicle arriving or
leaving the Site.  Adequate security
lighting of the Site shall be provided.

 

The Contractor shall prepare within thirty (30) Days after Notice to
Proceed a security plan for the Site for review by Owner, that shall address
measures related to access to the Site by Owner, Contractor, Subcontractors,
Sub-subcontractors and third parties, personnel identification, enforcement and
compliance by all such Persons with the Site security policy.  Contractor shall be responsible for
implementing, including monitoring of compliance with and enforcement of, such
security plan.

 

6.12                        Site Materials Handling, Control and
Preservation

 

Contractor shall be responsible for developing and implementing a plan
for all items of Equipment delivered to Site which will include and address the
following obligations of Contractor as a minimum:

 

a.               Receipt of all
items delivered to the Site, including unloading, unpacking, inspection,
storage and protection of same;

 

b.              Ensure that all
materials are used correctly and no materials are substituted without
Contractor’s agreement;

 

34

 

c.               Safekeeping, in
accordance with the vendor’s/manufacturer’s guidelines/instructions for
preservation of all Equipment on Site and ensuring that all materials are
marked as being provided for the Work;

 

d.              Establishing and
maintaining an adequate security system to control access to Equipment storage
sites and prevent theft or other loss;

 

e.               Maintain records
and account for all Equipment delivered and installed, and the remaining
surplus and scrap for all Equipment;

 

f.                 Maintain and
provide to Owner upon request a critical items delivery report (“Procurement
Status Report”), for Major Equipment and other critical items required for the
Work;

 

g.              Development and
implementation of a materials handling methods procedure for the movement of
all Major Equipment and materials, and

 

h.              The inspection,
care, preservation, and maintenance of materials and equipment.

 

6.13                        Material Control Procedure

 

Contractor shall implement strict material control throughout all
phases of the Work.  Contractor shall
submit to Owner for review within ninety (90) Days after Notice to Proceed, its
proposed material control procedures for inclusion in the Project procedures
manuals, which shall include Contractor’s plans and procedures for the use of
appropriate computer systems to manage material control and to provide Owner
with periodic status reports regarding the control of Equipment, and it shall
submit its procedures for these systems for Owner review.

 

6.14                        Material Marking

 

All Equipment arriving on Site shall be inspected by Contractor to
ensure that it is marked according to Project requirements, and purchase order
instructions. The marking of each item will act as a cross-reference to
associated documentation, Drawings and Work scope.

 

6.15                        Construction Utilities

 

6.15.1              Hydrotest water

 

Owner shall provide about 200,000 m3
of hydrotest water of suitable quality per API 620, Appendix Q,  within
4000 feet of the Tanks. Provision of and payment for Tank hydrotest water is
the responsibility of Owner.  Upon completion of the hydrotest the water shall be
returned to Owner within 4000 feet of the Tanks.

 

6.15.2              Electrical

 

Contractor shall be responsible for provision of construction power
facilities and payment for electrical consumption during construction until
Substantial Completion.

 

35

 

6.15.3              Potable Water

 

Contractor shall provide
potable water and ice for the Site use, and ensure that a safe and plentiful
supply of potable water and ice is available for all activities on the Site
until Substantial Completion.  The water
and ice for human consumption shall be of suitable quality.

 

6.15.4              Air

 

Until Substantial
Completion, Contractor shall provide instrument air for testing and operation
and compressed air suitable for construction, testing and drying and any other
purposes required in connection with performance of the Work.

 

6.15.5              Nitrogen

 

Until Substantial
Completion, Contractor shall provide all nitrogen as required for construction,
testing, drying, purging and commissioning, including the Tanks.  Nitrogen for testing, drying, purging and
commissioning shall be derived from liquid Nitrogen.

 

6.15.6              Fuels, Lubricants
& Service Fluids

 

Until Substantial
Completion, Contractor shall provide all necessary fuels, lubricants,
catalysts, and service fluids required for all Equipment, except that Owner
will supply Natural Gas for startup of the gas turbine generators and operation
until Cool Down of Tank 1.  Suitable
temporary storage of fuels, lubricants, and service fluids shall be provided
including secondary containment where required.

 

6.16                        First Fill Materials

 

Contractor shall supply
and install all first fill lubricants, chemicals, packings, distilled/deionized
water. First fill materials shall be stored in accordance with the
manufacturer’s instructions.  Contractor
shall provide SCV water, diesel fuel, caustic soda and lubricating oils from
date of first fill, including changes and replenishments, until Substantial
Completion.

 

36

 

7.                                      QUALITY MANAGEMENT

 

7.1                               Quality Assurance Requirements

 

Contractor shall provide
an integrated quality management group to operate the quality assurance,
quality control and certification functions of the quality management system.
The quality management group shall be independent from Contractor’s construction,
procurement and scheduling activities.

 

7.2                               Project Quality Plan

 

Contractor shall produce
a detailed Facility-specific quality assurance and inspection plan (“Project
Quality Plan”) for approval by Owner within sixty (60) Days after Notice to Proceed.  Owner will notify Contractor within ten (10)
Business Days after receiving the Project Quality Plan whether Owner approves
such plan, and if it does not approve the plan, will provide comments to
Contractor within such 10-Business Day Period, concerning those provisions
which require changes in order for Owner to approve the Project Quality
Plan.  The Project Quality Plan shall
define the Contractor organization and responsibilities of the quality
management group personnel and shall detail the procedures the Contractor
intends to use to manage and control those aspects of the work which may affect
the quality of the completed Facility.

 

The Project Quality Plan
shall meet the requirements of Section 3.18 of the Agreement, and be based on
Contractor’s standard quality assurance procedures, and shall cover the
following information:

 

1.               Project quality policy

 

2.               Project quality objectives

 

3.               Management responsibilities and duties of
all key QA personnel

 

4.               Quality assurance and quality control
organization

 

5.               A list and status of the procedures that
will be employed on the Project.  Program
of internal, supplier, and Subcontractor audits

 

6.               Documentation and certification control

 

7.               Control of nonconforming products or
processes and corrective actions

 

8.               Design validation

 

9.               Material traceability for all cryogenic
materials.

 

7.3                               Monitoring by Owner

 

(Reference Article 12.2
of the Agreement)

 

37

 

8.                                      COMMISSIONING
AND START UP

 

8.1                               Introduction

 

Contractor will be
responsible for carrying out the commissioning, start up, and testing of
Equipment including conducting Performance Tests, as set forth in greater
detail in Attachment V, Attachment S, and Attachment T.  In addition, Contractor will be responsible
for operation of the Facility through Substantial Completion (subject to Owner’s
rights under Section 11.8B of the Agreement). 
The Contractor shall have responsibility for the Equipment including
upkeep, scheduled and preventative maintenance until Substantial Completion;
provided, however, Owner shall bear the cost of any of the foregoing incurred
by reason of any Operations Activity required by Owner under Section 11.8B of
the Agreement.  Contractor shall provide
all consumable and spare parts for commissioning and anticipated start up spare
requirements, including all first fills, chemicals, and lubricants.  Commissioning activities include all
activities that must be completed prior to start up of Equipment, including,
but not limited to, introduction of inert gas to oxygen-free the equipment and
begin the drying out process.

 

Maintenance work during
commissioning shall be the responsibility of Contractor.  This work includes, but is not limited to,
checking pipe hangers, supports, guides and pipe specialties for operating
settings and making necessary adjustments. 
It also includes repair of any Equipment, piping, welding, assistance in
cleaning temporary strainers, replacing filters and removal of any blinds as
required.

 

8.2                               Project Commissioning Plan

 

Contractor shall produce
a detailed plan (“Project Commissioning Plan”) for review by Owner.  The Project Commissioning Plan shall list the
procedures the Contractor intends to use to ensure that Equipment is brought
through pre-commissioning, commissioning, startup, Performance Tests and
Substantial Completion safely.  The Project
Commissioning Plan will be implemented by Contractor, and address the following
as a minimum:

 

•            Mechanical completion

 

•            Field testing

 

•            Methodology for Cool Down;  RFCD; RFCD Punchlist

 

•            Commissioning

 

•            Development of operating manuals

 

•            Development of maintenance manuals

 

•            Ready for Performance Testing

 

•            Performance Testing

 

38

 

•            Emissions and noise testing

 

•            Interface with the FERC as required in
accordance with Section 10.

 

•            Substantial Completion Punchlist

 

•            Close-out

 

•            Demobilization

 

8.3                               Operating and Maintenance Manuals

 

At least six (6) months
prior to start of commissioning, the Contractor shall supply start up,
operation, and maintenance manuals for review by the Owner.  These start-up manuals will include the
sequence of activities that must be carried out in order to start up the
Facility.  The manuals shall incorporate
the DOT Part 193 Operator Qualification and OSHA 1910 requirements that define
the process safety management system.

 

8.4                               Performance Tests

 

(See Section 11.3 of the
Agreement and Attachment S)

 

8.5                               Operating Tests

 

Contractor
shall conduct the following operating tests to confirm the design meets the
requirements of the Scope of Work.  The
procedures and acceptance criteria will be finalized by Contractor and reviewed
with Owner prior to conducting the operating tests. The operating tests will be
conducted before or after the Performance Tests as agreed by the Parties.

 

8.5.1                     ESD Tests

 

The LNG tank high level alarms
and emergency shutdown (“ESD”) systems will be tested during precommissioning,
commissioning or operation with LNG/Natural Gas in the system as follows.  If unplanned inadvertent ESD trips occur
during initial operations then the below corresponding ESD test will be deemed
completed:

 

•                  Each Tank will be loaded to test the high
level alarm function; the test will not be done during ship unloading
operations.

 

•                  Ship unloading ESD tests to confirm
proper and safe operation of the ESD systems for the ship unloading
systems.  The ESD-2 system for ship
unloading will be simulated during commissioning with pins in place on the PERC
interface connection.  Operating
procedures will stipulate that the PERC system is tested (with pins in place)
prior to receipt of every LNG shipment.

 

•                  ESD-3 shutdown will be initiated to
ensure that send-out system is shutdown safely and in proper sequence during
LNG vaporization and sendout operation.

 

39

 

•                  Power failure simulation shutdown
will be initiated to ensure a safe, smooth ESD-3 shutdown sequence is achieved
during LNG vaporization and sendout operation.

 

8.5.2                     Baseline
Tests

 

The following tests will
be conducted to establish system performance:

 

•                  With no ship unloading, the Facility
will be turned down to the minimum design basis send-out without BOG venting
and without using any high pressure sendout compressor (high pressure sendout compressor
not included in Contractor’s Scope of Work).

 

•                  Heat inleak test based on material
balance to monitor and record BOG generation with full system and no or minimal
sendout and with no ship unloading.

 

8.6                               Owner Participation

 

(See Section 4.4 of the
Agreement and Attachment V)

 

8.7                               Owner Operator Training

 

(See Section 3.5 of the
Agreement and Attachment V)

 

8.8                               Vendor Training

 

(See Section 3.5 of the
Agreement and Attachment V)

 

8.9                               Operations Activities Prior to
Substantial Completion

 

(See Section 11.8 of the
Agreement)

 

8.10                        Owner’s Responsibility

 

(Refer to Attachment U)

 

40

 

9.                                      PROJECT CONTROL

 

9.1                               General

 

Contractor shall plan and
program the Work and its resource requirements in accordance with the requirements
of the Project Schedule

 

9.2                               Project Controls Plan

 

Contractor shall produce
a detailed Project controls plan (“Project Controls Plan”) for review by Owner
within sixty (60) Days after Notice to Proceed. 
Owner will provide comments within ten (10) Business Days. The Project
Controls Plan shall detail the procedures the Contractor to be used by
Contractor to maintain the scheduling, control, progress, Change Order control,
and reporting of all activities required to ensure that Substantial Completion
is achieved by the Guaranteed Substantial Completion Date.

 

9.3                               Program Reporting - Planning Network

 

The Work shall be
planned, managed, monitored and controlled by use of an integrated critical
path network planning system, derived from a work breakdown structure (“WBS”).

 

9.4                               CPM Schedule

 

Contractor shall produce
a CPM Schedule in accordance with Section 5.4 of the Agreement that will be the
reference schedule for the duration of the Project unless revised by Change
Order approved by the Owner.  The CPM
Schedule shall be the Project baseline plan comprising a control network
detailing all activities to be completed in a logical sequence and being in
sufficient detail to identify key activities and restraints, interdependencies,
interrelationships and resources required to control the Project.

 

The CPM Schedule shall:

 

1.               Be
consistent with the Project Schedule, including LNTP, NTP, the Guaranteed
Substantial Completion Date, and the Target Bonus Date,

 

2.               Represent
Contractor’s best judgment as to how it shall complete the Work in compliance
with the Project Schedule,

 

3.               Be
a detailed graphic representation of all significant aspects of the Work
showing Contractor’s plans for performance of the Work,

 

4.               Comply
with GECP,

 

5.               Indicate
a level of detail sufficient for Contractor to plan, organize, direct,
coordinate, perform and execute the Work, and for Owner to monitor the progress
of the Work,

 

6.               Include
separate activities for each significant portion of the Work including
activities for engineering, procurement, construction, commissioning, start up,
and testing,

 

41

 

7.               Show
the duration, start dates, and finish dates for each activity,

 

8.               Show
activity number, activity description, and responsible Person (i.e.,
Contractor,  Subcontractor, or
Sub-subcontractor) for each activity,

 

9.               Reflect
logical relationships between activities with a reasonable duration for each
activity, and show an uninterrupted critical path from the LNTP through NTP, Target
Completion, Substantial Completion and Final Completion,

 

10.         Show
individual paths between Target Completion and Substantial Completion which
clearly indicate where they may differ, and

 

11.         Indicate
all Milestones to be used for progress payments.

 

9.5                               Progress Measurement

 

The Contractor shall
until Substantial Completion develop and maintain systems and procedures for
the measurement of progress against the CPM Schedule.  The Contractor shall measure progress based
on actual Work completed.

 

9.6                               Meetings; Weekly Progress Meetings;
Minutes

 

Periodic meetings shall
be held as required for the purpose of keeping Owner fully informed of all
aspects of the Work, and for reviewing execution plans, technical or financial
concerns, progress status and scheduling of the Work, remedial actions, quality
concerns, safety concerns, interfaces, and Owner and Contractor plans for
resolving issues.

 

Commencing with LNTP,
weekly progress meetings will be held between Owner’s Representative or his
designee, and any other Persons designated by Owner, and Contractor’s Key
Personnel at the appropriate Site location, or as agreed by the Parties, Owner
or Contractor home office.  Owner and
Contractor shall agree on dates, standardized reports and agenda for such
meetings well in advance as the Work demands.

 

Minutes of all
progress-related meetings (including weekly and monthly progress meetings)
shall be prepared by Contractor (unless otherwise agreed by Owner) and sent to
Owner in electronic format within five (5) Business Days following the
meeting.  The contents of the minutes
shall be subject to review at the next weekly progress meeting. The format for
the preparation of the minutes shall be mutually agreed.  The minutes as a minimum should include
decisions made, action item responsibilities and action dates and the results
of assigned actions outlined in the previous minutes and shall be distributed
to all attendees, Owner Representative, and in accordance with the document
distribution matrix, to be developed during the Project execution.

 

9.7                               Monthly Progress Reports

 

Commencing with LNTP
Contractor shall provide a written Monthly Progress Report to Owner no later
than ten (10) Days after the end
of each Month, and the Monthly Progress Report shall cover activities up through
an agreed cut off date in the Month preceding the Month in which the

 

42

 

Monthly Progress Report
is issued.  Contractor shall provide
Owner with the number of copies of such reports and shall arrange for the
distribution thereof as Owner may reasonably request.

 

Commencing with LNTP a
progress meeting shall be held each Month by Contractor at the Site or at an
alternate site mutually agreeable to Owner and Contractor and at a mutually agreeable
time, for the purpose of reviewing with Owner the Monthly Progress Report
issued during such Month.

 

Contractor shall provide
Monthly Progress Reports in a form reasonably acceptable to Owner which will
indicate, at a minimum:

 

•                  Narrative summary of progress

 

•                  A description, as compared with the
Project Schedule and CPM Schedule, of engineering, procurement, construction,
commissioning, and testing status including actual percentage complete versus
planned percentage complete, document status, significant activities
accomplished during the reporting Month, significant activities planned for the
current Month and estimated dates on which RFCD, Ready for Performance Testing
and Substantial Completion shall be achieved

 

•                  Summary of Milestones planned and
actually completed

 

•                  Change Orders pending and approved

 

•                  Description of any problems
(including any occurrence of which Contractor is aware that could reasonably be
expected to increase the cost of the Project or delay Substantial Completion
beyond the Substantial Completion Date) and summary of plans for resolution

 

•                  A description of the status of the
Permits, including the dates of applications submitted or to be submitted and
the anticipated dates of actions by Governmental Instrumentalities with respect
to such Permits

 

•                  A description of reportable
environmental, health and safety incidents as well as any unplanned related
impacts, events, accidents or issues that occurred during the reporting period

 

•                  A description of all safety and
security issues

 

•                  A description of quality assurance
activities

 

•                  Progress photos showing
representative portions of the Site and the Work, including completed
Milestones, with a description of the photograph and the date taken

 

•                  All applicable information reasonably
required by FERC and other Governmental Instrumentalities

 

43

 

9.8                               Quarterly Executive Progress Reports

 

Commencing at LNTP,
within fifteen (15) Days after the end of each quarter, Contractor shall
provide Owner an executive progress report (“Executive Progress Report”)
suitable for presentation to Owner’s executive management and shareholders in a
form reasonably acceptable to Owner. 
These reports will be presented to Owner and discussed at a progress
meeting to be held between Contractor’s Key Personnel and Owner’s
Representative or his designee and any other Persons designated by Owner, every
four Months.  The Executive Progress
Reports will include:

 

•            Narrative summary of progress

 

•            Update of the status of the Project

 

•            Progress photographs and other
illustrations

 

•            Description of any problems and summary of
plans for resolution

 

9.9                               Contractor Deliverables

 

(See Attachment B,
Contractor Deliverables)

 

44

 

10.                               CONTRACTOR
INTERFACES

 

10.1        FERC Activities – Division of
Responsibility

 

Owner is required to
provide regular reports and other information to the FERC during design,
construction, and operation of the LNG Terminal as outlined in FERC
Authorization, and in the Code of Federal Regulations (CFR), Title 49 –
Transportation; Part 191 – Transportation of Natural and Other Gas by Pipeline;
Annual Reports, Incident Reports, and Safety Related Condition Reports, and
Part 193 – Liquefied Natural Gas Facilities: Federal Safety Standards.  The Facility will also be subject to regular
inspections by FERC staff, and continuous monitoring by inspectors providing
reports to FERC.  Contractor shall assist
Owner for interfaces with FERC, including as specifically noted in the Division
of Responsibility Matrix below:

 

	
  FERC
  Activity

  	
   

  	
  Owner

  	
   

  	
  Contractor

  	
   

  	
  Remarks

  
	
  FERC Permit overall
  responsibility

  	
   

  	
  P

  	
   

  	
  Note 1

  	
   

  	
  Refer to Owner Permits,
  Attachment Q.

  Note 1 - Contractor is
  responsible for construction related Permits,) refer to Attachment P).

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FERC communication/
  questions/ clarifications/ data request/ follow up items

  	
   

  	
  P

  	
   

  	
  S

  	
   

  	
  Contractor will
  participate in FERC scoping and cryogenic review meetings to support Owner as
  required.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FERC coordination
  during Project execution

  	
   

  	
  P

  	
   

  	
  S

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Department of
  Transportation (“DOT”) drug testing program during construction.

  	
   

  	
  S

  	
   

  	
  P

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FERC compliance and
  inspection during Project execution

  (a)   Owner’s Monthly Report

  (b)   Environmental inspector’s weekly reports
  concerning construction activities;

  (c)   Provide required Project data

  (d)   Update FERC permit data

  (e)   FERC technical reviews and occasional
  meetings

  (f)    FERC witness of tests such as Tank
  foundation, hydro test, startup and commissioning etc.

  (g)   Address FERC inspection and compliance
  issues

  	
   

  	
  P

  	
   

  	
  S

  	
   

  	
  Any Work performed by
  Contractor to support FERC inspection and compliance issues (other than
  issues arising due to Contractor’s failure to comply with provisions of the
  Agreement) that exceeds one thousand (1,000) man hours shall be subject to a
  Change Order to the extent such support adversely impacts (i) Contractor cost
  of performance of the Work; (ii) Contractor’s ability to perform the Work in
  accordance with the Project Schedule or (iii) Contractor’s ability to perform
  any obligation under the Agreement.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Submit final report to
  FERC

  	
   

  	
  P

  	
   

  	
  S

  	
   

  	
   

  

 

45

 

	
  Obtain FERC
  Authorization

  	
   

  	
  P

  	
   

  	
  S

  	
   

  	
  The FERC Authorization
  is required to site, construct and operate the Facility

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FERC’s authorization to
  commence operation

  	
   

  	
  P

  	
   

  	
  S

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Start-up and
  commissioning coordination with FERC

  	
   

  	
  P

  	
   

  	
  S

  	
   

  	
  Owner responsible for
  LNG supply, shipping and logistics, and Export Pipeline. .

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FERC requirement for
  Project Books and Records to be maintained three years after Final Completion

  	
   

  	
  P

  	
   

  	
  Note 2

  	
   

  	
  Note 2 - Contractor to
  turn over Project records at the earlier of expiration of the Defect
  Correction Period or termination of the Agreement.

  

 

Legend:

 

P = Primary responsibility

S = Contractor support is
limited to total 1000 man-hours commencing at LNTP for all FERC related
support.

NA = Not applicable

 

10.2                        FERC Required Reports

 

Owner is required to
provide regular reports and other information to the FERC during design,
construction, and operation of the Facility. 
The Facility will also be subject to regular inspections by FERC staff,
and continuous monitoring by inspectors providing reports to FERC.  Contractor shall assist Owner with all
interfaces with FERC as follows:

 

1.               Operation
and maintenance procedures and manuals, as well as emergency plans and safety
procedure manuals, shall be filed with the FERC prior to commissioning
operations.  Contractor is responsible
for developing these documents, including changes recommended by the FERC, and
resubmitting these documents as required.

 

2.               The
FERC staff shall be notified of any proposed revisions to the security plan and
physical security of the Facility prior to commissioning.  Contractor shall assist Owner in the
development of these plans, and shall advise Owner if changes to the design or
construction of the Facility may impact these plans.

 

3.               Progress
on the Project shall be reported in monthly reports submitted to the FERC.  Details should include a summary of
activities, problems encountered and remedial actions taken.  The Monthly Progress Report described in
Section 9.7 shall be formatted so that the required information can be easily
extracted by Owner and sent to the FERC.

 

4.               Problems
of significant magnitude shall be reported to the FERC on a timely basis.  Additional Site inspections and technical
reviews will be held by FERC staff prior to commencement of operation.  Contractor shall cooperate with Owner at all
times in this regard.

 

5.               The
Facility shall be subject to regular FERC staff technical reviews and Site
inspections on at least a biennial basis or more frequently as circumstances
indicate.  Prior to each FERC staff
technical review and Site inspection, the Owner will respond to a specific data
request

 

46

 

including
information relating to possible design and operating conditions that may have
been imposed by other agencies or organizations.  Provision of up-to-date detailed piping and
instrumentation diagrams reflecting Facility modifications and provision of
other pertinent information not included in the semi-annual reports described
below, including Facility events that have taken place since the previously
submitted annual report.  Contractor
shall assist Owner with these FERC reviews, requests, inspections, and reports
as required.

 

6.               Semi-annual
operational reports shall be filed with the FERC to identify changes in Facility
design and operating conditions, abnormal operating experiences, activities
(including ship arrivals, quantity and composition of imported LNG,
vaporization quantities, boil-off/flash gas, etc.), Facility modifications
including future plans and progress thereof. 
Abnormalities should include, but not be limited to: unloading/shipping
problems, potential hazardous conditions from offsite vessels, Tank
stratification or rollover, geysering, Tank pressure excursions, cold spots on
the Tanks, Tank vibrations and/or vibrations in associated cryogenic piping, Tank
settlement, significant equipment or instrumentation malfunctions or failures,
non-scheduled maintenance or repair (and reasons therefore), relative movement
of Tank inner vessels, vapor or liquid releases, fires involving Natural Gas
and/or from other sources, negative pressure (vacuum) within a Tank and higher
than predicted Boil-Off rates.  Adverse
weather conditions and the effect on the Facility also should be reported.  Reports should be submitted within forty-five
(45) Days after each period ending June 30 and December 31.  In addition, a section entitled “Significant
plant modifications proposed for the next 12 months (dates)” also shall be
included in the semi-annual operational reports.  Such information would provide the FERC staff
with early notice of anticipated future construction/maintenance projects at
the Facility.  Contractor shall develop
for Owner any semi-annual operational reports that may be due during the period
before Substantial Completion.

 

7.               Significant
non-scheduled events, including safety-related incidents (i.e., LNG or Natural
Gas releases, fires, explosions, mechanical failures, unusual over
pressurization, and major injuries) shall be reported to FERC staff within forty-eight
(48) hours.  In the event an abnormality
is of significant magnitude to threaten public or employee safety, cause
significant property damage, or interrupt service, notification shall be made
immediately, without unduly interfering with any necessary or appropriate
emergency repair, alarm, or other emergency procedure.  This notification practice shall be
incorporated into the Facility’s emergency plan.  Contractor shall develop for Owner any such
reports that may be required during the period before Substantial
Completion.  Examples of reportable
LNG-related incidents include:

 

•                  Fire;

 

•                  Explosion;

 

•                  Property damage exceeding $10,000;

 

•                  Death or injury requiring
hospitalization;

 

•                  Free flow of LNG for five minutes or
more that results in pooling;

 

47

 

•                  Unintended movement or abnormal loading
by environmental causes, such as an earthquake, landslide, or flood, that
impairs the serviceability, structural integrity, or reliability of the Facility;

 

•                  Any crack or other material defect
that impairs the structural integrity or reliability of Equipment that
contains, controls, or processes gas or LNG;

 

•                  Any malfunction or operating error
that causes the pressure of a pipeline or Equipment that contains or processes
gas or LNG to rise above its maximum allowable operating pressure (or working pressure
for LNG facilities) plus the build-up allowed for operation of pressure
limiting or control devices;

 

•                  A leak in Equipment that contains or
processes gas or LNG that constitutes an emergency;

 

•                  Inner tank leakage, ineffective
insulation, or frost heave that impairs the structural integrity of a Tank;

 

•                  Any safety-related condition that
could lead to an imminent hazard and cause (either directly or indirectly by
remedial action of the operator), for purposes other than abandonment, a 20
percent reduction in operating pressure or shutdown of operation of a pipeline
or an Equipment that contains or processes gas or LNG;

 

•                  Safety-related incidents to LNG
trucks or LNG vessels occurring at or in route to and from the Facility; or

 

•                  The judgment of the LNG personnel
and/or management even though it did not meet the above criteria or the
guidelines set forth in the Facility’s incident management plan.

 

In the event of an
incident, the FERC has authority to take whatever steps are necessary to ensure
operational reliability and to protect human life, health, property or the
environment, including authority to direct the Facility to cease
operations.  Following the initial
notification to Owner, FERC staff will determine the need for Owner to file a
separate follow-up report or follow-up in the upcoming semi-annual operational
report.  All follow-up reports should
include investigation results and recommendations to minimize a reoccurrence of
the incident.  Contractor shall develop
for Owner any such reports that may be required if the incident happened before
Substantial Completion.

 

Owner has overall
responsibility for the FERC permit application, coordination with FERC, and
compliance issues.  Contractor will
support Owner in providing required clarifications to FERC.  Any (i) FERC related support provided by
Contractor exceeding one thousand (1,000) man hours or (ii) additional Work
required by FERC that is not contemplated in this Scope of Work shall be
subject to a Change Order to the extent such excess support or additional Work adversely
impacts (i) Contractor cost of performance of the Work; (ii) Contractor’s
ability to perform the Work in accordance with the Project Schedule or (iii)
Contractor’s ability to perform any obligation under the Agreement.

 

48

 

10.3                        Requirements of Department of Homeland
Security

 

10.3.1              Facility Security
Plan

 

Owner is subject to the
requirements found in 33 CFR Part 105, and is required to develop and submit a
Facility security plan (“Facility Security Plan” or “FSP”) to the cognizant U.S.
Coast Guard Captain of the Port (“COTP”) for review and approval.  All submitted security plans will be
initially reviewed by a contractor at the National FSP Review Center.  Final FSP review and approval will be made by
the cognizant COTP.  Owner will submit
the FSP to the COTP approximately 12 months prior to Ready for Cool Down of the
Facility so that adequate time is available for review and revision and for
training of personnel.  Contractor shall
assist Owner in the development of this FSP as required, and will structure all
training programs for Owner to comply with this FSP.  Applicable Contractor personnel shall also be
trained to comply with this FSP for the period up to Substantial Completion.

 

10.3.2              Facility Security
Assessment

 

Owner is required to
develop a Facility security assessment (“Facility Security Assessment” or “FSA”)
which address “response procedures for fire or other emergency response
conditions” (33 CFR 105.305(a)(2)).  The
US Coast Guard also requires an emergency manual for LNG terminals in
accordance with 33 CFR 127.307.  The emergency
manual will be prepared and submitted to the COTP, along with the operations manual
required by 33 CFR 127.305, for approval before the Facility can be placed in
service.  Contractor shall assist Owner
in the development of this FSA and emergency manual.

 

10.4                        Vessel Security Plan

 

33 CFR 105.240 requires
that Owner address measures for interfacing with vessels calling at the Facility.  Those measures will be identified during the
FSA and will be included in the FSP. 
Each vessel calling at the Facility will also have a vessel security plan.  Owner security personnel will coordinate Facility
activities with the vessel operator.  It is
anticipated that the COTP will establish a moving safety zone around the LNG
carrier while underway and a stationary safety zone around the moored LNG
carrier and the Facility.  Except as
authorized by the COTP, all vessels other than those attending the LNG carrier
will be excluded from the safety zone area. 
To the extent deemed necessary by the COTP, the Owner, in concert with
the vessel operator, will provide waterside security patrols to assist the U.S.
Coast Guard in enforcing the safety zone requirements.  In the event that the COTP determines that
establishment of a safety zone is appropriate, usually in response to a
specific known or perceived threat, the Owner will confer with the COTP and
provide any additional forces necessary to meet the security goals established
at that time.  In accordance with Section
11.8 of the Agreement, Contractor shall assist Owner in coordinating all
vessels berthing at the Facility prior to Substantial Completion.

 

10.5                        Export Gas Pipelines

 

Owner shall be responsible
for construction and completion of the Export Gas Pipelines up to the
designated tie-in points on the outlet weld-in-insulator at the Master Meter.
Space shall be allowed for construction and operations of the pig trap
launcher, and provide road access.

 

49

 

10.6                        Existing Well

 

An existing operating gas
well is currently located on the Site. Contractor shall at all times avoid
interfering with the operation of the well and any related pipelines and
facilities, and shall provide reasonable access to the operator of the well or
pipeline for maintenance and other purposes.

 

10.7                        Environmental Mitigation

 

Owner is responsible for
wetlands mitigation required by Permits, Applicable Law or Governmental
Instrumentalities to be performed on or off the Site. Subject to Applicable Law
and Permits, it is anticipated that most such mitigation will take place after
the majority of construction by the Contractor has been completed.  Contractor shall cooperate to ensure the
mitigation is accomplished expeditiously and with minimum interference.

 

10.8                        Sabine Pass Lighthouse

 

The existing road to the
Sabine Pass Lighthouse (the “Lighthouse”) goes through the Site.  Contractor shall provide safe access to the
general public to allow visits to the Lighthouse from 9am to 4pm weekdays.  Contractor will provide escorts through the
Site, if required in Contractor’s judgment or if required by Owner or
Governmental Instrumentalities.  Public
access to the Lighthouse on weekends must be scheduled in advance with
Contractor so that escorts can be provided by Contractor.  Until the permanent road is completed on the east
side of the Site, access to the Lighthouse will be through the construction
area.  There may be times, in the
judgment of the Contractor, that it is not safe for public access to the road.
At such times Contractor shall deny access to the Lighthouse until it is deemed
safe for the public to enter the Site. 
All persons that cross through the Site are subject to Contractor’s Site
rules including the prohibition on the use of alcohol and entering the Project
with a firearm.  Contractor will ensure
that a copy of the rules will be given to all persons traveling through the
Site to the Lighthouse.

 

10.9                        WT Property

 

Owner is required to
provide access to the owner of the WT property located at the southeastern
corner of the Site as shown on Attachment Y.  Such access can be by appointment only.  Contractor, Subcontractors, Sub-subcontractors,
and any Persons for which they are legally responsible, shall not trespass upon
the WT property for any purpose.

 

50

 

11.                               SCOPE OF LNTP

 

The following activities
are in Contractor’s Scope of Work during the period after issuance of the LNTP
and prior to issuance of the NTP (the “LNTP Work”).  These activities will focus on supporting the
critical path schedule and include the following:

 

11.1                        Early
Change Orders

 

Section 12.2 of this Attachment
A lists work potentially to be added by Change Order which will be assessed
by Contractor during LNTP, decisions that will be made by Owner whether or not
to proceed, and any resultant Change Orders mutually agreed in accordance with
Article 6 of the Agreement.

 

11.2                        Project Planning Activities

 

•                  Plan
a Team Alignment Meeting

 

•                  Develop
the Level 2 CPM Schedule

 

•                  Develop
Early Project Staffing Plan

 

•                  Issue
90 Day Schedule

 

•                  Plan a Team Alignment Meeting

 

•                  Develop HSE Plan for Owner review

 

•                  Develop outline of the quality
assurance plan for Owner review

 

•                  Develop listing of reimbursable Work
items that are not included in the Scope of Work for Owner review

 

11.3                        Detail Engineering Activities

 

•                  Develop Project Execution Plan

 

•                  Prepare Project Specifications related
to Subcontracts and long lead Equipment

 

•                  Prepare Project procedures

 

•                  Prepare Project Work Instructions

 

•                  Finalize Process Design Basis

 

•                  Complete Process Simulations/Studies

 

•                  Issue Process Flow Diagrams (PFDs)
and Heat and material balances (HMBs)

 

51

 

•                  Complete Process Datasheets

 

•                  Finalize Basic Engineering Design
Data (BEDD)

 

•                  Issue P&IDs for Review – (IFR)

 

•                  Issue P&IDs and (Line Designation
Tables) (LDTs) for Approval – (IFA)

 

•                  Issue Equipment List for Review – (IFR
)

 

•                  Develop Design Pressure / Temperature
Guide

 

•                  Prepare Material Selection Guide (MSG)

 

•                  Update Datasheets and Prepare
Material Requisitions (MRs)

 

•                  Vaporizers

 

•                  Marine unloading arm

 

•                  BOG Compressors

 

•                  Gas Turbine Generator

 

•                  Prepare Pipe Specifications

 

•                  Issue Plot Plans for Approval (IFA)

 

•                  Update the Technical Packages for
following Subcontracts:

 

•                  Site Preparation

 

•                  Soils Improvement

 

•                  Tanks

 

•                  Construction dock

 

•                  Marine Facilities

 

•                  Review other Major Equipment Packages
and Subcontracts

 

•                  Develop Load Studies

 

•                  Develop Control Philosophy

 

11.4                        Procurement
Activities

 

•                  Update
Supplier Proposal

 

52

 

•                  Vaporizers

 

•                  Marine Unloading Arms

 

•                  BOG Compressors

 

•                  Gas Turbine Generators

 

11.5                        Subcontract
Activities

 

•                  Finalize
following Subcontracts

 

•                  Site Preparation

 

•                  Soils Improvement

 

•                  Tanks

 

•                  Release LNTP to Tank Subcontractor

 

•                  Release LNTP to soil improvement
Subcontractor

 

•                  Construction dock

 

•                  Marine Facilities

 

11.6                        Construction
Activities

 

•                  Mobilize
and start soil-mixing test

 

53

 

12.                               EXCLUSIONS
FROM CONTRACTOR SCOPE OF WORK

 

12.1                        Work by Others or Owner

 

(Refer to Attachment U).

 

12.2                        Work to Be Added by Change Order

 

(Refer to Attachment U).

 

12.3                        Items Potentially to be Added by Change
Order

 

Notwithstanding anything
in this Scope of Work or the Agreement, the following items are currently not
included within the Scope of Work since the items involved had not yet been
adequately defined at the time of signing of the Agreement.  This Work may be added by Change Order in
accordance with the procedures set forth in the Agreement.

 

12.3.1               Marine Facilities

 

•                  Navigation monitoring system is not
included in the Scope of Work.

 

•                  Remote quick release hooks are not
included in the Scope of Work. All mooring line hooks shall be specifically
ordered by Contractor with, and include load cells for line tension monitoring,
and quick release electrical and mechanical mechanisms.  The load cells and electrical quick release
mechanism shall not be wired or energized for service, and are intended to be
reserved for future use by Owner.

 

12.3.2              Electrical

 

•                  Grounding of perimeter fence.

 

•                  Full perimeter fence lighting.

 

•                  Lighting underneath the pipe rack.

 

•                  Power factor correction is not
considered and is excluded.

 

•                  Rear switchgear doors for power house
PH-1B (36” rear access space is provided behind the medium voltage
switchgear).  Switchgear rear panels can
only be accessed when the switchgear is de-energized.

 

12.3.3              Control Systems and
Instrumentation

 

No consideration has been
given to the monitoring or control of sales gas beyond the Master Meter. In
addition, no communication or telemetered signals of any kind to Export
Pipeline sales meters have been included.

 

54

 

12.3.4              Main Automation
Contractor

 

The current Scope of Work
includes a DCS and SIS, and does not account for additional features to be
determined by the main automation contractor (“Main Automatic Contractor”).  Owner intends to issue a separate contract
for a Main Automation Contractor to develop integrated business, information,
and control systems (“IBICS”) that will encompass both the operation of the
Facility and of other related systems corporate-wide.  Contractor and Main Automation Contractor
will jointly develop the following:

 

a.               Contractor,
working with the Main Automation Contractor, will be responsible for design,
procurement, installation, commissioning, and testing of all instruments,
cabling, bulks, equipment, software, hardware, and other materials required to
implement the IBICS.  Contractor will
develop Main Automation Contractor interface procedures, including:

 

•                  IBICS Scope of Work

 

•                  Main Automation Contractor/Contractor
Division of Responsibilities

 

•                  IBICS Procurement Plan

 

•                  IBICS Implementation Plan

 

b.              Contractor
will be required to work with the Main Automation Contractor to design,
specify, procure, install, and integrate the following portions of IBICS
related to the LNG Terminal into the overall Owner systems.

 

1.               Facility
Process Distributed Control Systems (DCS) and Operator Interface Console

 

2.               DCS
Historian

 

3.               Electronic
Flow Measurement Systems

 

4.               Measurement
Historian and Management System

 

5.               Tank
Inventory and Composition Monitoring System

 

6.               Fire
& Gas Detection System for Process, Storage and Marine Terminal

 

7.               CMMS
Development and Maintenance Work Order System

 

8.               Business
Intelligence and Reporting System through Web Portals

 

9.               Marine
Terminal Controls of Off-loading Arm Systems

 

10.         Access
Control System/Security Card Reader/POB reports

 

11.         Perimeter
Fence Barrier, Marine Terminal and Access Gate Intrusion Detection Systems

 

12.         CCTV
Process & Security Monitoring and Recording System

 

55

 

13.         Electrical
Power Management System

 

14.         Weather
station monitoring and data recording system

 

15.         Equipment
Reliability and Performance Monitoring

 

16.         Work
Permit & PSM Management

 

17.         Document
Management:

 

18.         Operator
Qualification and Training

 

19.         Accident
Investigation

 

20.         Engineering
Drawings and Documents

 

21.         Vendor
Manuals and Data

 

22.         Facility
Policies and Procedures

 

23.         Industry
Standards

 

24.         Government
Regulations

 

25.         Engineering
References

 

26.         Marine
Operations Archives

 

27.         Process
Safety Management

 

28.         Regulatory
Compliance

 

29.         Site
Safety Policies and Procedures Manuals

 

30.         Statistics
and Reporting

 

31.         Management
of Change

 

32.         HR
Systems

 

33.         Office
Applications

 

34.         Financial
Systems

 

35.         Purchasing/Inventory/Warehouse

 

12.3.5              Miscellaneous

 

•                  Treatment of SCV water to provide the
supply of service water for the Facility

 

56

 

•                  New dike and pond for holding hydro
test water (located on north side of Site)

 

•                  Office accommodations for up to two
(2) additional Owner personnel required at the Site and accommodations for up
to two (2) additional Owner personnel required in the Contractor’s home office,
all of which are in addition to those specified in Section 3.3 above.

 

•                  Additional partial shelter for
firewater pumps, high pressure sendout compressor and emergency standby diesel
generator.

 

•                  Additional east and west jetty areas
camera controllers and overhead TV monitors

 

•                  Standardized PLC Allen Bradley model
500 preferred

 

•                  Refill of fill materials after
Substantial Completion

 

•                  One radar type gauge will be added
for each Tank.

 

12.4                        Equipment and Material Prices

 

(Refer to Attachment
EE)

 

57

 

13.                               REIMBURSABLE
SCOPE OF WORK ITEMS

 

13.1                        Listing of Reimbursable Work Items

 

On or before issuance of
the NTP, Contractor shall develop and submit for Owner’s review a listing of
reimbursable Work items identified before the Effective Date for those items
described under Sections 13.2 through 13.6 below.

 

13.2                        Submerged Combustion Vaporizers

 

Contractor shall
invoice Owner on the basis of Reimbursable Costs for modifications to the
submerged combustion vaporizers necessary to meet the requirements of the air
permit; provided, however, the Parties shall
use their best efforts to mutually agree to a lump sum Change Order in
accordance with the terms of the Agreement as soon as sufficient information is
available to determine a lump sum adjustment. 
Provided that Owner responds to a Change Order request submitted by
Contractor in accordance with the procedures set forth in the Agreement,
Contractor shall not be entitled to any other adjustments to the Contract
Price, Project Schedule or any other Changed Criteria arising out of or
relating to the modifications to the submerged combustion vaporizers, subject
to adjustment by a Change Order under other terms of the Agreement for any
subsequent changes.

 

13.3                        High Pressure Sendout Compressor

 

At LNTP, Contractor shall
commence Work on the basis of Reimbursable Costs in connection with the
addition of a high pressure sendout compressor, until such time as Owner has
provided Contractor with evidence from the FERC confirming that the FERC does
not require Owner to add such high pressure sendout compressor.  In the event Owner provides Contractor with
such evidence from the FERC prior to NTP, Owner may remove such high pressure
sendout compressor from the Scope of the Work without impact to the Contract
Price, the Project Schedule or any other Changed Criteria or the obligation to
pay any further Reimbursable Costs in connection with the high pressure sendout
compressor.  If Owner does not provide
Contractor with such evidence from FERC prior to NTP, Contractor shall invoice
Owner on the basis of Reimbursable Costs for Work in connection with the high
pressure sendout compressor; provided, however,
the Parties shall use their best efforts to mutually agree to a lump sum Change
Order in accordance with the terms of the Agreement as soon as sufficient
information is available to determine a lump sum adjustment.

 

13.4                        Additional FERC Requirements

 

With respect to any
additional requirements imposed by the FERC after June 1, 2004 and which are
not otherwise included in the Scope of Work or the Contract Price (each, an “Additional
FERC Requirement” and, collectively, the “Additional FERC Requirements”), at
LNTP, Contractor shall commence Work on the basis of Reimbursable Costs in
connection with the modifications necessary to meet such Additional FERC
Requirements until such time as Owner has provided Contractor with evidence
from the FERC confirming that the FERC does not require Owner to add any one or
more Additional FERC Requirements.  In
the event Owner provides Contractor with such evidence from the FERC, Owner may
remove the applicable

 

58

 

Additional FERC
Requirement from the Scope of the Work without impact to the Contract Price,
the Project Schedule or any other Changed Criteria or the obligation to pay any
further Reimbursable Costs in connection with such Additional FERC
Requirement.  If Owner does not provide
Contractor with such evidence from FERC prior to NTP, Contractor may invoice
Owner on the basis of Reimbursable Costs for Work in connection with the
modifications necessary to meet any such Additional FERC Requirement; provided, however, the Parties shall use their best efforts
to mutually agree to a lump sum Change Order in accordance with the terms of
the Agreement as soon as sufficient information is available to determine a
lump sum adjustment.

 

13.5                        Additional LDEQ Requirements

 

With respect to any
additional requirements imposed by the LDEQ after March 1, 2004 and which are
not otherwise included in the Scope of Work or the Contract Price (each, an “Additional
LDEQ Requirement” and, collectively, the “Additional LDEQ Requirements”), at
LNTP, Contractor shall commence Work on the basis of Reimbursable Costs in
connection with the modifications necessary to meet such Additional LDEQ
Requirements until such time as Owner has provided Contractor with evidence
from the LDEQ confirming that the LDEQ does not require Owner to add any one or
more Additional LDEQ Requirements.  In
the event Owner provides Contractor with such evidence from the LDEQ, Owner may
remove the applicable Additional LDEQ Requirement from the Scope of the Work
without impact to the Contract Price, the Project Schedule or any other Changed
Criteria or the obligation to pay any further Reimbursable Costs in connection
with such Additional LDEQ Requirement. 
If Owner does not provide Contractor with such evidence from LDEQ prior
to NTP, Contractor may invoice Owner on the basis of Reimbursable Costs for
Work in connection with the modifications necessary to meet any such Additional
LDEQ Requirement; provided, however, the Parties
shall use their best efforts to mutually agree to a lump sum Change Order in
accordance with the terms of the Agreement as soon as sufficient information is
available to determine a lump sum adjustment.

 

13.6                        Additional USACE Requirements

 

With respect to any
additional requirements imposed by the USACE after June 1, 2004 and which are
not otherwise included in the Scope of Work or the Contract Price (each, an “Additional
USACE Requirement” and, collectively, the “Additional USACE Requirements”), at
LNTP, Contractor shall commence Work on the basis of Reimbursable Costs in
connection with the modifications necessary to meet such Additional USACE
Requirements until such time as Owner has provided Contractor with evidence
from the USACE confirming that the USACE does not require Owner to add any one
or more Additional USACE Requirements. 
In the event Owner provides Contractor with such evidence from the
USACE, Owner may remove the applicable Additional USACE Requirement from the
Scope of the Work without impact to the Contract Price, the Project Schedule or
any other Changed Criteria or the obligation to pay any further Reimbursable
Costs in connection with such Additional USACE Requirement.  If Owner does not provide Contractor with
such evidence from USACE prior to NTP, Contractor may invoice Owner on the
basis of Reimbursable Costs for Work in connection with the modifications
necessary to meet any such Additional USACE Requirement; provided,
however, the Parties shall use their best efforts to mutually agree
to a lump sum Change Order in accordance with the terms of the Agreement as
soon as sufficient information is available to determine a lump sum adjustment.

 

59

 

Schedule A-2

 

DESIGN
BASIS

 

The Design Basis consists
of the following items, plus the bases of design, technical parameters and
Specifications contained in the other provisions of Attachment A,
including the documents and Drawings listed in Schedule A-3, which are
incorporated by reference into the Design Basis.

 

Owner shall be
responsible for the information designated below as “Rely Upon”.  Subject to the requirements of Section 4.8 of
the Agreement, items listed as “Rely Upon” are considered to be part of the
Design Basis.  Contractor is entitled to
rely upon the specific information provided or to be provided by Owner for the
items designated as “Rely Upon”; however, Contractor shall be obligated to take
such information into account and to perform all relevant portions of the Work
in accordance with such information.

 

Items
designated below as “Design Reqt” are design requirements which define some of
the specifications, philosophies, selections, results, data or other
information that have been developed prior to the Contract Date.  These design requirements must be complied
with by Contractor unless modified by Owner during the Project.

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  1

  	
   

  	
  General

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.1

  	
   

  	
  Required daily Sendout Rate, annual average

  	
   

  	
  2600 MMscfd

  	
   

  	
  Contractor is not obliged to guarantee the
  annual average Sendout Rate

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.2

  	
   

  	
  Installed Capacity

  	
   

  	
  2880 MMscfd

  	
   

  	
  Running installed spares, provided pressure
  drops permit.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.3

  	
   

  	
  Installed spare availability

  	
   

  	
  Electrical systems and control systems must
  have sufficient capacity to operate all connected Equipment.

  	
   

  	
  The sendout capacity with all spares
  operating cannot be guaranteed, but if the Equipment is up, LNG is available,
  and the Export Pipeline can take the gas, this capacity should be available.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.4

  	
   

  	
  Design Natural Gas Sendout Temperature

  	
   

  	
  40 F (4.4 C) minimum measured at vaporizer
  outlet

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.5

  	
   

  	
  LNG Mol. Wt.

  	
   

  	
  17.1 - 18.9 To include the leanest of the
  lean and the richest of the rich for the Atlantic Basin (including Middle
  East)

  	
   

  	
  See Section 1.13 below

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.6

  	
   

  	
  Source of LNG

  	
   

  	
  Assume Trinidad, West Africa plus spot market
  which could be from any source in the Atlantic Basin, including Middle East.

  	
   

  	
  See Section 1.13 below

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.7

  	
   

  	
  Battery limit Natural Gas pressure
  requirement

  	
   

  	
  1250 psig at Guaranteed Sendout Rate
  downstream of Master Meter

  	
   

  	
  At battery limit

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.8

  	
   

  	
  Sparing philosophy

  	
   

  	
  N+1 philosophy for all major equipment
  (booster pumps, vaporizers) includes one installed spare. Guaranteed Sendout
  Rate to be obtained with 6 of the 9 in-tank pumps running.

  	
   

  	
  Each piece of Equipment must be able to be
  isolated for maintenance. See Section 1.9 below.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.9

  	
   

  	
  Manual Isolation

  	
   

  	
  Be able to safely isolate every piece of
  Equipment (booster pump/SCV train considered as one unit).

  	
   

  	
  Double block and bleed for all (liquid) LNG
  lines and vapor over 50 psig.

  	
   

  	
  Yes

  	
   

  	
   

  

 

60

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  1.10

  	
   

  	
  Venting

  	
   

  	
  No venting allowed under normal operations.
  Small purge of N2 allowed. Maintenance vents, drains allowed. The primary
  purpose for this vent is emergency venting of Natural Gas to a safe location
  (as required by code).

  	
   

  	
  This vent is NOT to be used as a flare. There
  may be times the vent is ignited by static electricity or lighting,
  therefore, the tip needs to be specified with flare materials. Fire
  suppression (using N2 plug flow) to be supplied.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.11

  	
   

  	
  BTU control

  	
   

  	
  No BTU Control system will be provided

  	
   

  	
  Removable spool is shown on P&ID.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.12

  	
   

  	
  Design Life (subject to Article 12 of the
  Agreement)

  	
   

  	
  25 years

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.13

  	
   

  	
  LNG specification range

  	
   

  	
  Equipment sizing based on rich case and lean
  case for all LNG from the Atlantic Basin and the Middle East. Equipment must
  be designed on the most stringent LNG based on the four LNG Specifications
  provided.

  	
   

  	
  Although determination of LNG specification
  range is Owner’s responsibility, Contractor shall be responsible for
  appropriate sizing of Equipment based upon the LNG. compositions specified
  below

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Lean Feed

  	
   

  	
  Rich Feed

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  Component

  	
   

  	
  (mole %)

  	
   

  	
  (mole %)

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  Supply source

  	
   

  	
  Trinidad

  	
   

  	
  NLNG

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  N2

  	
   

  	
  0.05

  	
   

  	
  0.137

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  CO2

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C1

  	
   

  	
  94.75308

  	
   

  	
  89.342

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C2

  	
   

  	
  3.550116

  	
   

  	
  5.322

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C3

  	
   

  	
  0.916118

  	
   

  	
  3.357

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  i-C4

  	
   

  	
  0.340988

  	
   

  	
  0.731

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C4

  	
   

  	
  0.339701

  	
   

  	
  1.1

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  i-C5

  	
   

  	
  0.05

  	
   

  	
  0.011

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C5

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C6

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C7-plus

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  Total

  	
   

  	
  100

  	
   

  	
  100

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Density [kg/m3]

  	
   

  	
  441.6

  	
   

  	
  466.4

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  Mol weight

  	
   

  	
  17.1

  	
   

  	
  18.5

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  HHV [Btu/Scf] (1)

  	
   

  	
  1067

  	
   

  	
  1142

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  LHV [Btu/ Scf] (1)

  	
   

  	
  963

  	
   

  	
  1032

  	
   

  	
   

  	
   

  	
  Yes

  
	
  
  

  

  

  
	
   

  	
   

  	
  (1) Standard conditions for US are 60 F and
  14.7 psia

  	
   

  	
   

  	
   

  	
  Yes

  

 

61

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Supply
  source

  	
   

  	
  Algeria Unknown Facility

  	
   

  	
  Unknown Facility B

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  N2

  	
   

  	
  1.4

  	
   

  	
  0.43

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  CO2

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C1

  	
   

  	
  89.8

  	
   

  	
  84.56

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C2

  	
   

  	
  6

  	
   

  	
  10.93

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C3

  	
   

  	
  2.2

  	
   

  	
  3.21

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  i-C4

  	
   

  	
  0.3

  	
   

  	
  0.47

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C4

  	
   

  	
  0.3

  	
   

  	
  0.38

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  i-C5

  	
   

  	
  0

  	
   

  	
  0.02

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C5

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C6

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  C7-plus

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  Total

  	
   

  	
  100

  	
   

  	
  100

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Density [kg/m3]

  	
   

  	
  464.4

  	
   

  	
  475.9

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  Mol weight

  	
   

  	
  17.92

  	
   

  	
  18.90

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  HHV [Btu/Scf] (1)

  	
   

  	
  1088.0

  	
   

  	
  1157.0

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
  LHV [Btu/ Scf] (1)

  	
   

  	
  982.7

  	
   

  	
  1046.5

  	
   

  	
   

  	
   

  	
  Yes

  
	
  
  

  

  

  
	
   

  	
   

  	
  (1) Standard conditions for US are 60 F and
  14.7 psia

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.14

  	
   

  	
  Equipment for Startup

  	
   

  	
  Facility will be designed to allow start up
  when the first Tank is ready, and the first berth is ready.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.15

  	
   

  	
  Cool Down assumptions

  	
   

  	
  Assume Cool Down with LNG (not LN2).

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  Emergency Issues

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.1

  	
   

  	
  Three Emergency Shutdown Systems to be
  provided

  	
   

  	
  ESD-1

  	
   

  	
  Ship unloading shutdown: LNG transfer will
  stop in a quick, safe, and controlled manner. All connections remain as is,
  all ship LNG transfer pumps shutdown. Manually activated by ship or the
  Facility, automatically activated by large unloading arm movement, HHLL in
  Tank or high pressure in Tank. Confirm during HAZOP review

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.2

  	
   

  	
   

  	
   

  	
  ESD-2

  	
   

  	
  Ship unloading shutdown and disconnection of
  unloading arms with minimum LNG spillage. Manually activated by ship or the
  Facility, automatically activated by gross unloading arm movement. ESD-1 has
  activated. Confirm during HAZOP review

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.3

  	
   

  	
   

  	
   

  	
  ESD-3

  	
   

  	
  Facility vaporization shutdown and isolation
  of all vaporization trains. Manually activated. Ship unloading mode is
  unaffected. Confirm during

  	
   

  	
  Yes

  	
   

  	
   

  

 

62

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  HAZOP review

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  Approach Channel and Turning Basin

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.1

  	
   

  	
  Harbor

  	
   

  	
  Harbor is 3.53 nm from beach line of Gulf of
  Mexico. Distance to Outer Buoy is 23.6 nm,

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.2

  	
   

  	
  Nighttime berthing/unberthing

  	
   

  	
  Yes. Contractor shall provide marine
  facilities in accordance with the scope defined in the Shiner Moseley marine
  facilities package and, in addition, shall provide lighting in accordance
  with API 540 Table 4.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.3

  	
   

  	
  Draft Required by typical LNG ship (125,000
  to 250,000 m3)

  	
   

  	
  38 to 41 feet

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.4

  	
   

  	
  Channel bottom texture

  	
   

  	
  Soft mud bottom (no rock, no coral)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.5

  	
   

  	
  Underkeel clearance required

  	
   

  	
  2 feet at mean low water (MLW)

  	
   

  	
  There is no hard U.S. Coast Guard
  requirement: but there is a requirement for the vessel’s master to determine
  that the clearance is adequate for safe transit in the channel and in the
  berth area.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.6

  	
   

  	
  Existing Channel Depth

  	
   

  	
  U.S. Army Corps of Engineers Project depth is
  specified to be 40 feet; however, actual channel depth is 42 ft plus 2 ft
  overdraft

  	
   

  	
  Currently the channel adjacent to the
  Facility is 42 feet at MLT. It will be dredged by Contractor to 45 feet + 2’
  over dredge at the maneuvering area and in the berth.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.7

  	
   

  	
  Existing Channel Width

  	
   

  	
  500 feet minimum to berth area

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.8

  	
   

  	
  Sabine river silting properties

  	
   

  	
  Yes

  	
   

  	
  Contractor will over-dredge depth of berth,
  so that silt accumulation can be observed over the first few years of
  operation

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.9

  	
   

  	
  Number of LNG ships dedicated to the Facility

  	
   

  	
  Spot market as required to meet sendout.

  	
   

  	
  2.6 BCF per day Sendout Rate will require 1
  tanker load every 1.5 days (average).

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.10

  	
   

  	
  Jetty Length

  	
   

  	
  As required to connect berth to land

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.11

  	
   

  	
  Number of berths

  	
   

  	
  Two

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.12

  	
   

  	
  Berth availability

  	
   

  	
  Near 100%

  	
   

  	
  Subject to weather downtime (fog, high winds,
  and lightning storm)

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.13

  	
   

  	
  Existing Port/Harbor Services

  	
   

  	
  Will be used as back up only

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.14

  	
   

  	
  Tug Services

  	
   

  	
  Three dedicated tractor tugs with “Z” drive
  at 50 tons minimum Bollard pull and 5000 HP, each with fire fighting
  capabilities required.

  	
   

  	
  Owner will provide tugs.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.15

  	
   

  	
  Tug Berthing

  	
   

  	
  Tug berth harbor provided at the Facility.

  	
   

  	
  Services for tugs will be power and potable
  water only (no fuel).

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.16

  	
   

  	
  Maneuvering Area

  	
   

  	
  None presently exists.

  	
   

  	
  Contractor responsible for dredging of
  maneuvering area adjacent to berths. Design Basis is the Shiner-Mosley Marine
  Facilities FEED Package

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.17

  	
   

  	
  Port/Harbor Pilots

  	
   

  	
  Pilots will be trained by a mutually agreed
  Port Simulator specializing in LNG ships. Project sponsored.

  	
   

  	
  Owner’s Responsibility

  	
   

  	
   

  	
   

  	
  Yes

  

 

63

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  3.18

  	
   

  	
  Pilot Required

  	
   

  	
  Yes, for inbound and outbound LNG ships (two
  pilots will be required for night transit)

  	
   

  	
  Pilot pickup will be at the outer buoy
  located 23.6 nm from the Facility. Pilot drop off will be somewhat closer in.
  Owner responsible for arranging pilots

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.19

  	
   

  	
  Dredge Spoil Amount

  	
   

  	
  Estimated to be about 4.5 million cubic yards

  	
   

  	
  Design Basis is the Shiner-Mosley Marine
  Facilities FEED Package

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.20

  	
   

  	
  Dredge Spoil Placement

  	
   

  	
  Dredge spoil will be placed at the Dredge
  Material Placement Area (DMPA) specified in Attachment Y.

  	
   

  	
  Transport of dredge spoil to DMPA shall be
  Contractor’s responsibility and is included in the Contract Price.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.21

  	
   

  	
  Line Handling Boats

  	
   

  	
  Two required, dedicated to the Facility.

  	
   

  	
  Owner will provide line handling boats

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4

  	
   

  	
  Site Description

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.1

  	
   

  	
  Wetlands

  	
   

  	
  Delineation of wetlands is in the Army Corps
  of Engineers Permit

  	
   

  	
  Owner’s responsibility

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.2

  	
   

  	
  NOx limitations

  	
   

  	
  NOx emissions as defined in the Air Permit

  	
   

  	
  Total NOx emissions classify Project a
  “major” source in Louisiana. This requires PSD permitting. No special NOx
  reduction measures are required downstream of the equipment

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.3

  	
   

  	
  Land Available

  	
   

  	
  As described in Attachment Y

  	
   

  	
  Owner’s responsibility

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.4

  	
   

  	
  Permanent Easement Availability

  	
   

  	
  As described in Attachment Y

  	
   

  	
  Owner’s responsibility

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.5

  	
   

  	
  Access Roads, Bridges & Other
  Infrastructure

  	
   

  	
  None exist. Contractor to develop
  infrastructure as part of the Scope of Work.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6

  	
   

  	
  Final Site Elevation (MSL)

  	
   

  	
  As required for drainage and to protect
  Equipment and buildings from storm surge of 14 ft.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6.1

  	
   

  	
  Tank impoundment floor

  	
   

  	
  High point elevation as required to meet the
  capacity required by 49 CFR 193

  	
   

  	
  Grading and drainage per code, sump will be
  below ground level. High ground water must be considered during design.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6.2

  	
   

  	
  Improved areas

  	
   

  	
  High point elevation as required for adequate
  drainage

  	
   

  	
  Common grounds, administration building lawn

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6.3

  	
   

  	
  Process and pipeways

  	
   

  	
  14 ft (bottom of pipe)

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6.4

  	
   

  	
  Interfacility Roads and parking

  	
   

  	
  2 feet above natural elevations.

  	
   

  	
  Asphalt surface

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6.5

  	
   

  	
  Buildings

  	
   

  	
  14.5 ft (top of slab)

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6.6

  	
   

  	
  Top of dike elevation

  	
   

  	
  As required to achieve design capacity
  required by 49 CFR 193.

  	
   

  	
  10 foot wide road on along top of dikes

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6.7

  	
   

  	
  Tanks

  	
   

  	
  On elevated piles, 3 ft air gap preferred.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.7

  	
   

  	
  Geotechnical Conditions

  	
   

  	
  See the Geotechnical Reports referenced in Schedule
  A-3

  	
   

  	
  Most Equipment, buildings, and structures to
  be on pile foundations Dikes and roads will not be.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.8

  	
   

  	
  New roads

  	
   

  	
  Yes, along the east border

  	
   

  	
  The existing dirt/gravel road running through
  the Site (leading to the lighthouse) must be replaced.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.9

  	
   

  	
  Natural land characteristics

  	
   

  	
  Plant footprint shall limit impact to the

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  

 

64

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
   

  	
   

  	
   

  	
   

  	
  land. Temporary construction laydown areas
  must be returned to its natural state.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.10

  	
   

  	
  Drainage

  	
   

  	
  Original drainage patterns should be
  preserved as much as possible.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.11

  	
   

  	
  Differential settlement

  	
   

  	
  The
  engineering design shall be such that a six (6) inch differential settlement
  between pile-supported structures and adjacent non-piled facilities or
  fill/improved areas which may occur from Substantial Completion through the
  expected lifetime of the Facility will not cause any Defects with normal
  monitoring and maintenance provided by Owner.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5

  	
   

  	
  Seismic Conditions

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.1

  	
   

  	
  Basic Seismic Design to be per ASCE 7 and
  NFPA 59A.

  	
   

  	
  See ABS Consulting report in Resource Report
  13 for more details

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.2

  	
   

  	
  Operating Basis Earthquake (OBE)

  	
   

  	
  OBE=0.03g, OBE spectral acceleration at
  1-second period is 0.03 g

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.3

  	
   

  	
  Safe Shutdown Earthquake (SSE)

  	
   

  	
  SSE=0.05g, SSE spectral acceleration at
  1-second period is 0.06 g

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6

  	
   

  	
  Climatic Data

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Design Ambient Temperature

  	
   

  	
  Minimum: 14
  deg F; Maximum 90 deg F

  	
   

  	
  No heat tracing required for freeze protection

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.2

  	
   

  	
  Maximum Design Barometric Pressure Change

  	
   

  	
  0.295 inches of Hg/hr (10 mbar/hr)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.3

  	
   

  	
  Maximum Design Wind Speed

  	
   

  	
  150 mph (67.1 m/s) sustained.

  	
   

  	
  Special wind speed requirement per CFR, Title
  49, Part 193. Wind design to otherwise conform to ASCE-7, exposure C, I=1.0.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.4

  	
   

  	
  Maximum Rainfall in 24 hours , 100 year storm
  event

  	
   

  	
  11 inches per hour for 100 year storm

  	
   

  	
  49 CFR requires water removal rate at 25% of
  the collection rate from a 10 year frequency and one hour duration rainfall.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.5

  	
   

  	
  Maximum Design Snowfall

  	
   

  	
  Zero

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7

  	
   

  	
  LNG Storage Tanks

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.1

  	
   

  	
  Type of Tank

  	
   

  	
  Single containment on piles, no bottom or
  side penetration

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.2

  	
   

  	
  Number of Tanks

  	
   

  	
  Three total

  	
   

  	
  Space for three future tanks, to be located
  directly north of the present proposed Tanks. The space requirement for the
  future tanks is not in the Scope of Work.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.3

  	
   

  	
  Capacity (Gross)

  	
   

  	
  169,600 m3

  	
   

  	
  Tank Subcontractor to confirm.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.4

  	
   

  	
  Capacity (Working)

  	
   

  	
  160,000 m3

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tank OD

  	
   

  	
  269 feet (82 meters)

  	
   

  	
  Tank Subcontractor to confirm.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.5

  	
   

  	
  Minimum Heel

  	
   

  	
  1 meter

  	
   

  	
  Minimum level sets NPSH available for in-tank
  pump

  	
   

  	
  Yes

  	
   

  	
   

  

 

65

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  7.6

  	
   

  	
  Maximum Design LNG Density

  	
   

  	
  30.5 lb/ft3 (489 kg/m3)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.7

  	
   

  	
  Minimum Design LNG Temperature

  	
   

  	
  -265 F (-165 C)

  	
   

  	
  Dependent on LNG composition. Set temperature based on Hysys simulation.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.8

  	
   

  	
  Maximum Internal Design Pressure

  	
   

  	
  2.5 psig (172 mbarg)

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.9

  	
   

  	
  Minimum dike height

  	
   

  	
  15 to 17 feet above Tank floor elevation

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.10

  	
   

  	
  Support Piles

  	
   

  	
  Piles required. See the Geotechnical Reports listed in Schedule
  A-3.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.11

  	
   

  	
  Maximum Tank Heat In-Leak Rate at 90 F (32.2 C)

  	
   

  	
  0.05 vol%/day/tank (based on pure methane)

  	
   

  	
  By calculation

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.12

  	
   

  	
  Instrumentation Philosophy

  	
   

  	
  Fully automatic as shown on P&IDs listed in Schedule A-3.

  	
   

  	
  Instrument and control philosophy needs to be determined and written.
  Expect controls to be PLC based.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.13

  	
   

  	
  Tank spacing

  	
   

  	
  Per NFPA-59A

  	
   

  	
  Refer to plot plan SK-SP-0001 and T-SP-009

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.14

  	
   

  	
  Number of in-Tank pumps

  	
   

  	
  3 pumps with one spare well in each Tank. Spare well is not piped or
  wired up. Foot valve is to be provided with each spare well .

  	
   

  	
  Nine in-Tank pumps installed in 3 Tanks. Sendout Rate Guarantee
  Conditions using 6 pumps (assume one Tank down or as a spare). Warehouse
  spare pump.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.15.1

  	
   

  	
  Level control and safeguarding:

  	
   

  	
  Level indicators provided to control limits of LNG level will be per
  NFPA 59A requirements.

  	
   

  	
  Two automatic, continuous Tank level gauges to be provided. In
  addition there is a high level gauge installed. Need density profile.
  Redundant temperature indicators in annular space.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.15.2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  On low low level (LA/LL), in Tank pumps are stopped automatically.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.15.3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  On high high level (LA/HH), the unloading operation is stopped by
  activation of ESD-1.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.16.1

  	
   

  	
  Pressure control and safeguarding:

  	
   

  	
  Three pressure controllers to be provided

  	
   

  	
  1. Absolute pressure controller dedicated to BOG Compressor capacity
  control.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.16.2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2. Pressure controller (on gauge pressure) dedicated to the vent
  valve to relive high pressure (set just below PSV pressure). Activates ESD-1

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.16.3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  3. Pressure controller (on vacuum gauge pressure) dedicated to
  introduce Natural Gas from the Sendout Pipeline to prevent vacuum (set just
  above VSV pressure).

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.16.4

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  HP venting is controlled with 1 pressure transmitter at each Tank,
  with logic opening the vent based on the highest reading. LP vacuum breaker
  is controlled with 1 pressure transmitter at each Tank, logic opens the gas
  makeup based on the lowest reading.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.17

  	
   

  	
  Tank shutdown

  	
   

  	
  Two redundant ESD pressure transmitters

  	
   

  	
  Two pressure (gauge) transmitters are dedicated to emergency shutdown
  (stop compressor on low pressure; stop unloading operation via an ESD-1 in
  case of high high pressure) . To be

  	
   

  	
  Yes

  	
   

  	
   

  

 

66

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  confirmed during HAZOP review

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.18

  	
   

  	
  Impounding area

  	
   

  	
  Yes, one per Tank with remote sump in each.

  	
   

  	
  110% of full storage

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.19

  	
   

  	
  Tank Startup

  	
   

  	
  Facility will startup when the first Tank is cooled down

  	
   

  	
  This means the remaining two Tanks will be finished under hot-work
  permits. Positive Tank isolation is required.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.20

  	
   

  	
  Tank Deluge system

  	
   

  	
  Provide 3 water monitors on elevated posts (equal to dike height)
  pre-aimed for maximum coverage of Tank side. In addition, two (pressure
  boosted) monitors are located on top the platform which can be aimed at the
  max radiation spots.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8

  	
   

  	
  Ship
  Berths

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.1

  	
   

  	
  Number of berths

  	
   

  	
  Two

  	
   

  	
  Each berth to be a mirror image

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.2

  	
   

  	
  Number of ships to unload simultaneously

  	
   

  	
  Two at combined rate equal to maximum permitted by both LNG ship
  capabilities and procedures.

  	
   

  	
  See 8.6 below

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.3

  	
   

  	
  Future unloading

  	
   

  	
  Considerations for 2 ships to unload simultaneously at full rate. No
  pre-investment in unloading lines, vapor return lines, or Equipment except as
  specified in Section 4.5 of Schedule A-1.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.3

  	
   

  	
  Design codes for berth

  	
   

  	
  Yes, refer OCIMF and SIGTTO. These are recommendations, and should be
  treated as such.

  	
   

  	
  Refer to SIGTTO’s publication “Prediction of Wind Loads on Large
  Liquefied Gas Carriers”

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.4

  	
   

  	
  LNG ship size

  	
   

  	
  86,500 m3 to 250,000 m3

  	
   

  	
  For 250,000 m3 ship, length overall (LOA) = 344m, molded breadth
  (Bmld) = 54m, operating draft = 12 m, molded depth (Dmld) = 27m, length
  between perpendiculars (LBP) = 332 m.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.5

  	
   

  	
  Frequency of LNG Ship Unloading (average)

  	
   

  	
  One every 1.5 days based on 138,000 m3 ship sizes.

  	
   

  	
  Depends on size of ship. Larger ships will allow fewer loads.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.6

  	
   

  	
  Average Ship Unloading Rate

  	
   

  	
  12,000 m3/hr through two (2) 30” unloading lines.

  	
   

  	
  Does not change with number of ships unloading. Two ships can unload
  but at half the rate. Leave room on piperack for two (2) more 30” unloading
  lines plus one (1) more vapor return line. Note that future oversize vessels
  that are 200 km3 and 250 k

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.7

  	
   

  	
  Maximum Shipboard LNG Storage Pressure

  	
   

  	
  1.5 psig (103.4 mbarg)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.8

  	
   

  	
  Minimum Ship Pump Discharge Pressure

  	
   

  	
  70.0 psig (4.83 barg)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.9

  	
   

  	
  Maximum Unloading Time

  	
   

  	
  11.5 hours for 138,000 m3 ship, 16.7 hours for 200,000 m3 ship

  	
   

  	
  Performance Test to be based on unloading 120,000 m3 of LNG over a
  continuous 10 hour period. Test procedures and details to be developed. Time
  to hookup, test, startup, cooldown, etc not counted. Actual rate will be
  dependent on LNG ship used for the test. See Attachment T

  	
   

  	
  Yes

  	
   

  	
   

  

 

67

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  8.10

  	
   

  	
  Number of Unloading Arms per berth

  	
   

  	
  Three liquid, one vapor. Leave space for a fourth liquid arm.

  	
   

  	
  One liquid arm can be converted to vapor

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.11

  	
   

  	
  Max Offloading Capacity per Unloading Arm

  	
   

  	
  Average capacity for all 3 arms is 12,000 m3/hr. Required 20” arms
  with 16” full port valves.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.12

  	
   

  	
  Vapor Return Capacity per Return Arm

  	
   

  	
  12,000 m3/hr displaced vapor equivalent

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.13

  	
   

  	
  Size of Offloading and Vapor Return Arms

  	
   

  	
  20 inch diameter, Full bore 16” valves.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.14

  	
   

  	
  Size of Flanges on Tanker Manifold

  	
   

  	
  16 inch diameter

  	
   

  	
  Assume spot market ships will have adaptors to fit 16” flange.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.15

  	
   

  	
  Manifold Flange Spacing

  	
   

  	
  3 meters

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.16

  	
   

  	
  Distance from Ship Manifold to Berth Side (Max/Min)

  	
   

  	
  6 meters/4 meters

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.17

  	
   

  	
  Maximum Sway of Tanker from Berth Side (Drift)

  	
   

  	
  3 meters

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.18

  	
   

  	
  Maximum Fore/Aft Ship Surge

  	
   

  	
  3 meters

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.19

  	
   

  	
  Maximum elevation change during unloading

  	
   

  	
  Less than 2.5 meters

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.20

  	
   

  	
  Emergency Release Connection

  	
   

  	
  PERC (Powered and capable of automatic actuation on ESD-2)

  	
   

  	
  To be confirmed during HAZOP

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.21

  	
   

  	
  Connection to ship flange

  	
   

  	
  Manual cam-lock on end of arms

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.22

  	
   

  	
  Minimum distance from Ship to Tanks allowed

  	
   

  	
  Must be outside 10,000 btu/hr/ft2 line. Current plot plan provides
  adequate distance.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.23

  	
   

  	
  Elevation of Unloading Platform

  	
   

  	
  At least 20 ft.

  	
   

  	
  All electronics and berth platform floor must be above any potential
  surge heights.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.24

  	
   

  	
  Capacity of Gangway Hoist

  	
   

  	
  No gangway hoist required.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.25

  	
   

  	
  Services Available to LNG Tankers

  	
   

  	
  Food and miscellaneous parts (as needed)

  	
   

  	
  Bunker and nitrogen and all other supplies supplied by ship’s own
  resources

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.27

  	
   

  	
  Wind gust for holding station

  	
   

  	
  60 knots (30 second average)

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.28

  	
   

  	
  Potential for Surge

  	
   

  	
  Yes. From passing ships

  	
   

  	
  Refer to OCIMF’s publication “Guidelines and Recommendations of the
  Safe Mooring of Large Ships at Piers and Sea Islands”.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.29

  	
   

  	
  Line handling boats

  	
   

  	
  Yes

  	
   

  	
  Assume two boats required occupied by two persons during
  berthing/deberthing operations.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9

  	
   

  	
  Vaporization
  Process & Regasification Process Pumps

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.1

  	
   

  	
  Type of Main Vaporizers

  	
   

  	
  Submerged Combustion Vaporizers (SCVs) with stainless steel tanks

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.2

  	
   

  	
  Number of Main Vaporizers

  	
   

  	
  15 + 1 spare (16 total) to produce 2.6 BCF/d Annual Average Daily
  Sendout Rate

  	
   

  	
  SCV’s can actually produce approximately 180 MMscf/d, therefore 15
  operating should be able to produce 2.7 Bcf/d if all are operating at their
  design guarantee rate. Sendout is minus fuel gas. See Attachment T.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.3

  	
   

  	
  Heat source

  	
   

  	
  Fuel gas

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  

 

68

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  9.4

  	
   

  	
  Fuel Gas source

  	
   

  	
  SCVs must be able to self-boot using their own vaporized LNG for
  fuel.

  	
   

  	
  Separate tube in bath to heat fuel supply

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.5

  	
   

  	
  Capacity of Each Vaporizer

  	
   

  	
  180 MMscf/d

  	
   

  	
  Nominal capacity, based on largest proven SCV from T-Thermal. See Attachment
  T.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.6

  	
   

  	
  Control philosophy

  	
   

  	
  Safe, stable Facility operation is automatically controlled.
  Adjustments to capacity are manually input within the operating range of the
  Equipment. DCS type system to control all Equipment.

  	
   

  	
  Control philosophy document to be developed.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.7

  	
   

  	
  Vaporizer PSV

  	
   

  	
  Per NFPA 59A paragraphs 5.4 and 6.8

  	
   

  	
  Pipe all PSV tail pipes from the vaporizers to a high pressure vent.
  Low pressure PSV’s not to be piped to this vent.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.8

  	
   

  	
  LNG Primary In-Tank Pumps Type

  	
   

  	
  In-tank vertical turbine type with inducer

  	
   

  	
  Inducer plus one or two stages ok.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.9

  	
   

  	
  Number of In-Tank Sendout Pumps/Tank

  	
   

  	
  Three per Tank

  	
   

  	
  See Item 7.14.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.10

  	
   

  	
  In-Tank Sendout Pump Capacity

  	
   

  	
  Normal 3,912 gpm @ 100 psig, rated at 4,304
  gpm

  	
   

  	
  Confirm flow rates.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.11

  	
   

  	
  LNG Booster Pumps Type

  	
   

  	
  Vertical turbine type with inducer

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.12

  	
   

  	
  Number of LNG Booster Pumps

  	
   

  	
  15 + 1 spare (16 total)

  	
   

  	
  Pipe one booster pump to one vaporizer, for a total number of 16
  trains. No flanges or block valves between pump and vaporizer (in high
  pressure LNG). Double block and bleed at vaporizer discharge and send out
  pump suction.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.13

  	
   

  	
  LNG Booster Pumps Capacity

  	
   

  	
  Normal 1,533 gpm @ 1,200 psig, Rated at
  1,686 gpm

  	
   

  	
  Confirm flow rates.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.14

  	
   

  	
  Sendout & Booster Pumps Driver

  	
   

  	
  Internal or external electric motor to be considered.

  	
   

  	
  Internal electric motors provided

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.15

  	
   

  	
  Sendout & Booster Pumps Bearing Life

  	
   

  	
  3 to 5 years

  	
   

  	
  To be confirmed by Contractor.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10

  	
   

  	
  Fire
  & Gas Safety

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.1

  	
   

  	
  Firewater Pump Number

  	
   

  	
  2 + 1 jockey + 1 booster pump for Tanks

  	
   

  	
  Use standby tug as a backup firewater pump

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.2

  	
   

  	
  Firewater Pump Capacity

  	
   

  	
  2 @ 100% = 2000 m3/hr eachV

  	
   

  	
  Contractor to verify capacity for code requirements

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.3

  	
   

  	
  Firewater Pump Driver (backup)

  	
   

  	
  One (1) diesel engine, 1MW

  	
   

  	
  Contractor to verify size for capacity

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.4

  	
   

  	
  Firewater Pump Driver

  	
   

  	
  One (1) diesel engine, 1MW

  	
   

  	
  Contractor to verify size for capacity

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.5

  	
   

  	
  Fire Protection System

  	
   

  	
  Fresh water, one high-expansion foam trailer, dry powder, N2

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.6

  	
   

  	
  Firewater storage

  	
   

  	
  Yes, use dug mud-bottom pond with elevated pump platform. Capacity to
  be much greater than the minimum requirement of 2 hours.

  	
   

  	
  Fire water pond to also serve as a holding pond for the SCV water
  discharge.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11

  	
   

  	
  Blowers
  & Compressors

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.1

  	
   

  	
  BOG Compressor Type

  	
   

  	
  Cryogenic reciprocating

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  

 

69

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  11.2

  	
   

  	
  Number of BOG Compressors

  	
   

  	
  3 @ 50% BOG cryogenic reciprocating compressors sized for ship
  unloading case.

  	
   

  	
  Leave space for expanding the building for inclusion of two more
  compressors. Air compressors to not be in the way of the BOG expansion.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.3

  	
   

  	
  BOG Compressor for unloading mode

  	
   

  	
  Three compressors at 50% gives one spare compressor

  	
   

  	
  If the one compressor has an unscheduled outage, BOG will be vented
  until repairs are completed, or ship unloading will slow down..

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.4

  	
   

  	
  BOG Compressor for holding mode

  	
   

  	
  Use BOG compressor in turndown mode or on/off mode as required to
  maintain Tank pressure.

  	
   

  	
  Note that all three Tanks’ vapor space is tied together to act as one
  giant vapor space. Therefore on/off operation is acceptable.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.5

  	
   

  	
  BOG Compressor Driver

  	
   

  	
  Electric motor

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.6

  	
   

  	
  Cold Vapor Return Blower Type

  	
   

  	
  Low boost blower or fan

  	
   

  	
  10 psig discharge pressure

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.7

  	
   

  	
  Cold Vapor Return Blower Number

  	
   

  	
  Two-50% units. Sized based on returning vapor displaced from Tanks,
  but accounting for vapor formed by heat leak into the ship during unloading.
  Low pressure boost approximately 10 psi

  	
   

  	
  If one unit has an unscheduled outage, unloading will continue at
  reduced rates.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.8

  	
   

  	
  Cold Vapor Return Blower Driver

  	
   

  	
  Electric motor

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.9

  	
   

  	
  Instrument Air Compressor Type

  	
   

  	
  Lubed screw type

  	
   

  	
  Purchase pre-packaged self contained units with dryers.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.10

  	
   

  	
  Instrument Air Compressor Number

  	
   

  	
  Three 285 scfm units (3 X 50%)

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.11

  	
   

  	
  Instrument Air Compressor Driver

  	
   

  	
  350 hp each electric motor

  	
   

  	
  To be confirmed by Contractor.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.12

  	
   

  	
  Motors

  	
   

  	
  All motors, without exception, will be TEFC

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12

  	
   

  	
  Utilities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.1

  	
   

  	
  Vent system

  	
   

  	
  Yes, high pressure vent and Low pressure vent

  	
   

  	
  Tank PSV tailpipes are NOT to be connected to any vent system,
  instead they must be vented directly to atmosphere.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.1.1

  	
   

  	
   

  	
   

  	
  LOW PRESSURE VENT: Atmospheric vent (for maintenance vents/drains,
  and general PSV’s)

  	
   

  	
  Purchase a flare tip to prevent damage if accidentally ignited, but
  use as a vent.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.1.2

  	
   

  	
   

  	
   

  	
  HIGH PRESSURE VENT: To vent the tailpipes from the SCVs and all other
  RVs with discharge pressure greater than 75 psig.

  	
   

  	
  Purchase a flare tip to prevent damage if accidentally ignited, but
  use as a vent.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.2

  	
   

  	
  Nitrogen package

  	
   

  	
  23,000 scfh vapor with 5000 gallons liquid N2 storage

  	
   

  	
  Lease LN2 Tank with ambient air vaporizer. Owner’s responsibility.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.3

  	
   

  	
  Electric Power Supply

  	
   

  	
  Self generate all electric power

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.4

  	
   

  	
  Sparing philosophy for electrical power system

  	
   

  	
  N + 1

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.5

  	
   

  	
  Standby Generator

  	
   

  	
  Diesel

  	
   

  	
  Power output to be confirmed by Contractor

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.6

  	
   

  	
  Sewage Treatment

  	
   

  	
  Yes

  	
   

  	
  Use packaged unit

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.7

  	
   

  	
  Instrumentation Philosophy

  	
   

  	
  Fit for purpose DCS. Require all vendors to provide the same brand
  and model PLC.

  	
   

  	
  Not currently specified in the FEED.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.8

  	
   

  	
  Custody Metering of Natural Gas to Export Pipeline

  	
   

  	
  Yes

  	
   

  	
  Use four + 1 ultrasonic types+ 1 is a spare

  	
   

  	
   

  	
   

  	
  Yes

  

 

70

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  12.9

  	
   

  	
  Custody transfer of LNG

  	
   

  	
  Yes

  	
   

  	
  LNG tanker strapping

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.10

  	
   

  	
  Fuel Gas System

  	
   

  	
  Yes, low pressure for SCVs

  	
   

  	
  No odorization for sendout gas. Heat pumps for building heat.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.11

  	
   

  	
  Pipeline relief philosophy

  	
   

  	
  Not required at Facility

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.12

  	
   

  	
  Communication System

  	
   

  	
  LAN, telephone, and two-way radio

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.13

  	
   

  	
  Bunker Facilities

  	
   

  	
  Not required

  	
   

  	
  Ships contract for refueling barges offsite

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.14

  	
   

  	
  Ship Services

  	
   

  	
  Food only. Maintenance parts on an as needed (and prearranged) basis.
  No other services for ships.

  	
   

  	
  Ship takes care of its own nitrogen, bunker, and fire protection
  requirements. Owner’s responsibility.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.15

  	
   

  	
  Power available

  	
   

  	
  13.2 kV, 60 Hz, 3 phase, 3 wires Power (1800 Amp bank potential) is
  on the property (north side). The existing 13.2 kV is adequate for
  construction

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.16

  	
   

  	
  Water requirements Construction

  	
   

  	
  For personnel usage, 8000 gpd. If a concrete batch plant is used, another
  13 gpm average. Peak use is water filling truck @ 270 gpm + normal usage.

  	
   

  	
  Construction personnel may peak at about 700, with an average of
  around 400.300. Most construction water will be for personnel usage &
  washdown unless a concrete batch plant is used.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.17

  	
   

  	
  Water requirements Hydrotest

  	
   

  	
  Need about 100,000 m3 (26.4 million gallons) potable water to fill a
  Tank over a 2 week duration.

  	
   

  	
  Owner’s responsibility

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.18

  	
   

  	
  Service Water requirements Operation

  	
   

  	
  Assume 40 gpm normal water usage rate with 240 gpm required for
  instantaneous max water rate.

  	
   

  	
  A 4” feed water line is the expected minimum connection size.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13

  	
   

  	
  Buildings

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.1

  	
   

  	
  Administration Offices

  	
   

  	
  One Story. Includes a small kitchen but no cooking facilities,
  security station with customs and paperwork with 24 hour access, with CCTV’s
  of berths. Size per Trend T-SP-033.

  	
   

  	
  Security pass required to enter the Facility. Building to be steel
  frame with metal/stone façade. Offices for 35 persons. Large meeting/greeting
  room. No showers, no lockers. 12’ x 14’ typical office. At least 16 offices.
  Large windows.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.2

  	
   

  	
  Control Building

  	
   

  	
  Two Story. Plenty of windows. Include 2nd floor balcony on 3 sides
  with overhand roof. Design to be flexible steel frame. Size per Trend
  T-SP-033. Elevator for at least 6 persons.

  	
   

  	
  Control room to be located on the second level for clear view of
  process area. First level to contain meeting room, I/O controllers,
  electrical, battery room, UPS, DCS, SIS system, (computer, controls,
  electrical, etc). This building is NOT to be “blast proof”.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.3

  	
   

  	
  Warehouse/ Maintenance Building

  	
   

  	
  Size per Trend T-SP-033.

  	
   

  	
  Actually two buildings together (end on end or side by side) with
  combined function. Equip with gantry crane. Include A/C Laboratory room (20’
  x 25’) in this building. Large openings (at least 16’ wide rollup doors) for
  getting Equipment in/out. Include unisex toilets each with showers

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.4

  	
   

  	
  BOG Compressor Shelter

  	
   

  	
  Size per Trend T-SP-033.

  	
   

  	
  Equip with gantry crane. Size to match Equipment, but allow space for
  doubling of Equipment.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.5

  	
   

  	
  Main Substation building

  	
   

  	
  Size per Trend T-SP-033.

  	
   

  	
  Stand alone building, Includes motor control and switchgear

  	
   

  	
  Yes

  	
   

  	
   

  

 

71

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  13.6

  	
   

  	
  Jetty Substation building

  	
   

  	
  Prefab building. Size per Trend T-SP-033.

  	
   

  	
  Stand alone building on each berth. No restroom. Contains the
  following UPS batteries, self contained eye wash near batteries, MCC, I/O
  cabinet, SIS cabinet, one desk w/ chair, control-console for unloading arms,
  CRT for display (not control) of process

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.7

  	
   

  	
  Firewater pump house

  	
   

  	
  25 ft x 32 ft

  	
   

  	
  Could be a shelter with two sides

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.8

  	
   

  	
  Gate house

  	
   

  	
  At least 11 ft x 16 ft

  	
   

  	
  Stand alone building. Assume two guards will be present. Include one
  unisex toilet facility.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.9

  	
   

  	
  Marine Building

  	
   

  	
  Two. Size per Trend T-SP-033.

  	
   

  	
  Located near each berth to service USCG, customs, tug and ship
  captains. Three offices with central gathering/meeting room. Two unisex
  restrooms.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.10

  	
   

  	
  HVAC

  	
   

  	
  Heat pumps (not Natural Gas)

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.11

  	
   

  	
  Hurricane rollup shutters

  	
   

  	
  Required on windows of control building and administration building

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14

  	
   

  	
  Export
  Pipeline

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.1

  	
   

  	
  Pig receiver/launcher

  	
   

  	
  Not in the Scope of Work

  	
   

  	
  Leave space for others for Export Pipeline

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.2

  	
   

  	
  Odorization

  	
   

  	
  Not required

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.3

  	
   

  	
  MAOP of Export Pipeline

  	
   

  	
  1,980 psig

  	
   

  	
  From the booster pumps through SCV up to and including ESD valves the
  line spec is 900# class. From the ESD valves through the metering skid the
  line spec is 600# class.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.4

  	
   

  	
  Operating pressure

  	
   

  	
  1250 psig

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15

  	
   

  	
  Metering

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.1

  	
   

  	
  Natural Gas metering

  	
   

  	
  A Master Meter will monitor total Facility output. Custody transfer
  will take place at the connections to Export Pipeline.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.2

  	
   

  	
  Type of meters for Main Sendout Meter

  	
   

  	
  Ultrasonic, 0.25% accuracy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.3

  	
   

  	
  Number of custody transfer meters

  	
   

  	
  4 metering skids installed (25% each) plus on spare meter element in
  the warehouse

  	
   

  	
  Quantity and sizing are to be confirmed.

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.4

  	
   

  	
  Fuel gas meters

  	
   

  	
  Ultrasonic, 0.25% accuracy

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16

  	
   

  	
  Miscellaneous

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.1

  	
   

  	
  Low water bridge weight limit

  	
   

  	
  25 tons (50,000 lbs) for dual axle trucks.

  	
   

  	
  Hwy 82 crossing the mouth of Sabine Lake. The bridge is on the state
  line (Port Arthur on the west, Cameron Parish on the east). Bridge rotates
  for boat traffic. This is a serious limitation for east-bound construction
  traffic. Traffic from the east has the usual load limitation of 86,000 lbs –
  to be confirmed by Contractor.

  	
   

  	
   

  	
   

  	
  Yes

  

 

72

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  16.2

  	
   

  	
  Helipad

  	
   

  	
  Yes

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.3

  	
   

  	
  Construction dock

  	
   

  	
  In accordance with the documents listed Schedule A-3 under
  “Construction Dock”

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.4 thru 16.5

  	
   

  	
  Not used

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.6

  	
   

  	
  Power Failure

  	
   

  	
  Upon power failure assume the security system stays up, control room
  is fully functional, ship unloading stops.

  	
   

  	
  If an emergency situation exists where the ship is partially full but
  it must continue to unload (for what ever reason), assume displaced vapors
  will be vented.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7

  	
   

  	
  Cryogenic Valve and Pipe Requirements

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.1

  	
   

  	
  Valves

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.2

  	
   

  	
   

  	
   

  	
  All cryogenic valves will be installed with the stem in the-vertical
  axis (rising upward). Maximum of forty-five degrees from vertical either way
  is allowed.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.3

  	
   

  	
   

  	
   

  	
  All cryogenic valves will have a minimum extension of 18 inches as
  measured from top of flange.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.4

  	
   

  	
   

  	
   

  	
  For on/off service, the cryogenic valve of choice is the ball valve
  or butterfly valve.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.5

  	
   

  	
   

  	
   

  	
  Cryogenic gate valves are not acceptable. Use of gate valves of any
  type must have Owner’s prior written approval.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.6

  	
   

  	
   

  	
   

  	
  Lug body and wafer butterfly valves are not acceptable.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.7

  	
   

  	
   

  	
   

  	
  Cryogenic ball valves can be of the “floating-ball” or “trunion”
  design.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.8

  	
   

  	
   

  	
   

  	
  All cryogenic valves must have a cavity vent (if applicable). All
  cavity vented valves must have permanent stenciled markings on the vented
  flange. The P&ID’s must indicate the cavity vent side.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.9

  	
   

  	
   

  	
   

  	
  Cryogenic valves shall not be hydrotested. If water touches the
  graphite seals, the seal shall be replaced (not dried).

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.7.10

  	
   

  	
   

  	
   

  	
  All cryogenic check valves shall be drilled to allow a small backward
  flow of LNG. All cryogenic check valves NOT drilled must have Owner’s prior
  written approval.. P&ID’s must indicate all drilled check valve.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.8

  	
   

  	
  Piping:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.8.1

  	
   

  	
   

  	
   

  	
  All cryogenic connections will be a minimum of 2” in the vertical (up
  or down) until the first valve. Sizes can change after the first valve. Side
  connections are generally not acceptable. Only under very special conditions
  and only with Owner’s prior written approval will other arrangements be
  allowed.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  

 

73

 

	
   

  	
   

  	
  Item

  	
   

  	
  Design Basis

  	
   

  	
  Remarks

  	
   

  	
  DESIGN

  REQT

  	
   

  	
  RELY

  UPON

  
	
  16.8.2

  	
   

  	
   

  	
   

  	
  All cryogenic piping and fittings less than 2-inches in diameter
  shall be schedule 80.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.8.3

  	
   

  	
   

  	
   

  	
  Threaded connections are not acceptable for cryogenic fittings and
  piping.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.8.4

  	
   

  	
   

  	
   

  	
  Only dual certified stainless steels (where possible) will be used as
  piping.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.9

  	
   

  	
  Miscellaneous:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.9.1

  	
   

  	
   

  	
   

  	
  Design pressure of the sendout (booster) pumps and the SCV’s must be
  set considerably higher than the pumps can produce.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.9.2

  	
   

  	
   

  	
   

  	
  High pressure vent to contain only the code required PSV tailpipes
  for the vaporizers. The low pressure vent to contain all other vents.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.9.3

  	
   

  	
   

  	
   

  	
  All vessels shall be rated for full vacuum.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17

  	
   

  	
  Guarantees
  and Warranties

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.1

  	
   

  	
  Sendout Rate Performance Guarantee

  	
   

  	
   

  	
   

  	
  Refer to Attachment T.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.2

  	
   

  	
  Turndown

  	
   

  	
  No guarantee.

  	
   

  	
  Operating Test to determine turndown. See Section 8.5.2 of Schedule
  A-1.

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.3

  	
   

  	
  Tank Heat Leak

  	
   

  	
  Tank heat leak = 0.05% per day based on pure methane using approved
  calculation methodology.

  	
   

  	
   

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.4

  	
   

  	
  Ship Unloading Time Performance Guarantee

  	
   

  	
   

  	
   

  	
  Refer to Attachment T

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.5

  	
   

  	
  Warranty

  	
   

  	
   

  	
   

  	
  Refer to Article 12 of the Agreement

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18

  	
   

  	
  Engineering
  Standards

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18.1

  	
   

  	
  Grid Coordinate System

  	
   

  	
  Louisiana State Plane, South Zone, NAD 83

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18.2

  	
   

  	
  Elevation Reference

  	
   

  	
  NAVD 88

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19

  	
   

  	
  Interfaces

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19.1

  	
   

  	
  Reroutes

  	
   

  	
  Existing 3 inch gas line from gas well to Rte 82 to be rerouted
  around Tank .

  	
   

  	
  Owner’s responsibility

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19.2

  	
   

  	
  Lighthouse road

  	
   

  	
  New road required from rte 82 to Site will be built on eastern
  boundary of Block 18 (leased property). Road will continue on to provide
  public access to Lighthouse. Security gate will be required.

  	
   

  	
  Contractor to provide road through Facility, and upgrade road from
  Facility to Lighthouse.

  	
   

  	
  Yes

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19.3

  	
   

  	
  Wetland mitigation

  	
   

  	
  Mitigation to be designed and constructed on or near Site

  	
   

  	
  Wetland mitigation will be designed and constructed by others.

  	
   

  	
   

  	
   

  	
  Yes

  

 

74

 

Schedule A-3

 

Conceptual Engineering Documents
and Trends List

 

Conceptual Engineering Documents

 

The following Drawings, Specifications and other documents are included
in the Contract Price and form part of Design Basis.

 

	
  Doc Type/Folder

  	
   

  	
  Doc Number

  	
   

  	
  Title/Description

  	
   

  	
  Rev.

  	
   

  	
  Source

  	
   

  	
  Notes

  
	
  GENERAL
  PROJECT

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  DG100703

  	
   

  	
  Sabine Pass Vapor Thermal
  Dispersion Report RR13.4

  	
   

  	
   

  	
   

  	
  PTL

  	
   

  	
  PTL (Project Technical
  Liaison)

  
	
   

  	
   

  	
  Report (9/19/2003)

  	
   

  	
  Geological Hazard
  Evaluation, Sabine LNG Terminal, Sabine, Louisiana

  	
   

  	
   

  	
   

  	
  T-W

  	
   

  	
  T-W (Tolunay – Wong)

  
	
   

  	
   

  	
  Letter 1 (9/12/2003)

  	
   

  	
  Geotechnical Investigation,
  Sabine LNG Terminal, Cryogenic Tanks, Sabine, Louisiana

  	
   

  	
   

  	
   

  	
  T-W

  	
   

  	
   

  
	
   

  	
   

  	
  Letter (9/19/2003)

  	
   

  	
  Final Report, Geotechnical
  Investigation, Sabine LNG Terminal, Process Area, LNG Pipe Racks, Berth and
  Construction Docks, Sabine, Louisiana

  	
   

  	
   

  	
   

  	
  T-W

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Survey Plat

  

  Cheniere LNG, Inc. Survey of
  property lease in the Sabine Pass area

  	
   

  	
   

  	
   

  	
  Owner

  	
   

  	
  By Lonnie G. Harper and
  Associates, Inc.

  

  Dated 01/26/2004

  
	
  PROCESS /
  SYSTEMS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  LNG Import Terminal Venting
  Philosophy

  	
   

  	
   

  	
   

  	
  B&V

  	
   

  	
  B&V (Black &
  Veatch)

  
	
  Heat and
  Material Balance

  	
   

  	
  01-1010A1-A8

  	
   

  	
  Heat and Material Balance

  	
   

  	
  P3

  	
   

  	
  B&V

  	
   

  	
   

  
	
  PFD’s

  	
   

  	
  350-D01-0010A

  	
   

  	
  PFD - LNG Off Loading
  /Storage

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0010B

  	
   

  	
  PFD - LNG
  Vaporization/Sendout

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0010C

  	
   

  	
  PFD - Power Generation
  System

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
  P&ID’s

  	
   

  	
  350-D01-0010W

  	
   

  	
  P&ID – General Piping
  Legend & Sym.

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0010Y

  	
   

  	
  P&ID – General Instr.
  Legend & Sym.

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0010Z1

  	
   

  	
  P&ID - Equip. Legend
  & Symbol

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0011

  	
   

  	
  P&ID - LNG Unloading
  Arms East Jetty

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0012

  	
   

  	
  P&ID - Jetty Piping
  East Jetty

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0013

  	
   

  	
  P&ID - LNG Unloading
  Arms West Jetty

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0014

  	
   

  	
  P&ID - Jetty Piping
  West Jetty

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0015

  	
   

  	
  P&ID - Intercon. Piping
  at Piperack

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0016

  	
   

  	
  P&ID - Intercon. Piping
  LNG Storage Tanks

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0017

  	
   

  	
  P&ID - LNG Storage Tank
  S-101

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0018

  	
   

  	
  P&ID - LNG Storage Tank
  S-102

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0019

  	
   

  	
  P&ID - LNG Storage Tank
  S-103

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0020

  	
   

  	
  P&ID - Tanks S-101-LNG
  Intank Pumps

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0021

  	
   

  	
  P&ID - Tanks S-102 -
  LNG Intank Pumps

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0022

  	
   

  	
  P&ID - Tanks S-103 -
  LNG Intank Pumps

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  

 

75

 

	
   

  	
   

  	
  350-D01-0023

  	
   

  	
  P&ID - LNG Send-out
  Header

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0024A

  	
   

  	
  P&ID - Boil Off Gas
  Condenser

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0024B

  	
   

  	
  P&ID - Boil Off Gas
  Condenser

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0025

  	
   

  	
  P&ID - LNG Send-out
  Pumps A/B

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0026

  	
   

  	
  P&ID - LNG Send-out
  Pumps C/D

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0027

  	
   

  	
  P&ID - LNG Send-out
  Pumps D/E

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0028

  	
   

  	
  P&ID - LNG Send-out
  Pumps G/H

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0029

  	
   

  	
  P&ID - LNG Send-out
  Pumps J/K

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0030

  	
   

  	
  P&ID - LNG Send-out
  Pumps L/M

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0031

  	
   

  	
  P&ID - LNG Send-out
  Pumps N/P

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0032

  	
   

  	
  P&ID - LNG Send-out
  Pumps Q/R

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0033

  	
   

  	
  P&ID - LNG Vaporizer A

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0034

  	
   

  	
  P&ID - LNG Vaporizer B

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0035

  	
   

  	
  P&ID - LNG Vaporizer C

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0036

  	
   

  	
  P&ID - LNG Vaporizer D

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0037

  	
   

  	
  P&ID - LNG Vaporizer E

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0038

  	
   

  	
  P&ID - LNG Vaporizer F

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0039

  	
   

  	
  P&ID - LNG Vaporizer G

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0040

  	
   

  	
  P&ID - LNG Vaporizer H

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0041

  	
   

  	
  P&ID - LNG Vaporizer J

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0042

  	
   

  	
  P&ID - LNG Vaporizer K

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0043

  	
   

  	
  P&ID - LNG Vaporizer L

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0044

  	
   

  	
  P&ID - LNG Vaporizer M

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0045

  	
   

  	
  P&ID - LNG Vaporizer N

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0046

  	
   

  	
  P&ID - LNG Vaporizer P

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0047

  	
   

  	
  P&ID - LNG Vaporizer Q

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0048

  	
   

  	
  P&ID - LNG Vaporizer R

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0049

  	
   

  	
  P&ID - Send-out Gas
  Header

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0050

  	
   

  	
  P&ID - Send-out
  Metering

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0051

  	
   

  	
  P&ID - Boil Off Gas
  Header Piping

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0052

  	
   

  	
  P&ID - Vapor Return
  Blower C-101-A

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0053

  	
   

  	
  P&ID - Vapor Return
  Blower C-101-B

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0054

  	
   

  	
  P&ID - Boil Off Gas
  Compressor Suction

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0055

  	
   

  	
  P&ID - Boil Off Gas
  Compressor A

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0056

  	
   

  	
  P&ID - Boil Off Gas
  Compressor B

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0057

  	
   

  	
  P&ID - Boil Off Gas
  Compressor C

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0060

  	
   

  	
  P&ID - Liquid Drain Pot

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0061

  	
   

  	
  P&ID - Vent System

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0062

  	
   

  	
  P&ID - Nitrogen System

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0064

  	
   

  	
  P&ID -
  Instrument/Utility Air Systems

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0065

  	
   

  	
  P&ID - East/West Jetty
  Instr./Utility Air System

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0066

  	
   

  	
  P&ID - Fuel Gas

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  

 

76

 

	
   

  	
   

  	
  350-D01-0068

  	
   

  	
  P&ID - Caustic System

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0069

  	
   

  	
  P&ID - Mains/S-101 -
  Impoundment Basin

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0069A

  	
   

  	
  P&ID - S-102/S-103
  Impoundment Basin

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0069B

  	
   

  	
  P&ID - Jetty Impoundment
  Basin

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0070

  	
   

  	
  P&ID - Fire Water
  System

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0071

  	
   

  	
  P&ID - Fire Water
  Piping

  	
   

  	
  00B

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0080

  	
   

  	
  P&ID - GTG Fuel Gas
  Supply

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0081

  	
   

  	
  P&ID - Turbine Power
  Generation

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0082

  	
   

  	
  P&ID - Turbine Power
  Generation

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0083

  	
   

  	
  P&ID - Turbine Power
  Generation

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0084

  	
   

  	
  P&ID - Turbine Power
  Generation

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0085

  	
   

  	
  P&ID - Turbine Power
  Generation

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  350-D01-0082

  	
   

  	
  P&ID - Turbine Power
  Generation

  	
   

  	
  00A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
  Equipment
  List

  	
   

  	
  350-MOX-00001

  	
   

  	
  Equipment List

  	
   

  	
  00E

  	
   

  	
  Contractor

  	
   

  	
   

  
	
  Equipment
  Datasheets

  	
   

  	
  C-101

  	
   

  	
  Data Sheet - Vapor Return
  Blower

  	
   

  	
   

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  C-102

  	
   

  	
  Data Sheet - Boil Off Gas
  Compressor (A-C)

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  H-101

  	
   

  	
  Data Sheet - Submerged
  Combustion Vaporizer (H-101A-R)

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  K-101/102

  	
   

  	
  Data Sheet - Unloading Arms

  	
   

  	
   

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  K-103

  	
   

  	
  Data Sheet - Gas Metering

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  K-107

  	
   

  	
  Data Sheet - Nitrogen
  Package

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  K-108

  	
   

  	
  Data Sheet - Instrument Air
  Package (A-C)

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  K-109

  	
   

  	
  Data Sheet – Static Mixer
  (A-D)

  	
   

  	
   

  	
   

  	
  Contractor

  	
   

  	
  Study

  
	
   

  	
   

  	
  P-101

  	
   

  	
  Data Sheet - S-101 LNG
  Intank Pumps

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-102

  	
   

  	
  Data Sheet - S-102 LNG
  Intank Pumps

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-103

  	
   

  	
  Data Sheet - S-103 LNG
  Intank Pumps

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-104

  	
   

  	
  Data Sheet - Sendout Pumps

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-105

  	
   

  	
  Data Sheet - Fire Water
  Pump

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-106

  	
   

  	
  Data Sheet - Fire Water
  Jockey Pump

  	
   

  	
  P

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  P-107

  	
   

  	
  Data Sheet - Impoundment Basin
  Sump Pumps

  	
   

  	
  P2

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  P-109

  	
   

  	
  Data Sheet - Process
  Impoundment Basin Pumps

  	
   

  	
  P1

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  P-111

  	
   

  	
  Data Sheet - Firewater
  Booster Pump

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-112

  	
   

  	
  Data Sheet - S-101
  Impoundment Basin Pumps

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-113

  	
   

  	
  Data Sheet - S-102
  Impoundment Basin Pumps (A-B)

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-114

  	
   

  	
  Data Sheet - S-103
  Impoundment Basin Pumps

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  P-115

  	
   

  	
  Data Sheet - Jetty
  Impoundment Basin Pumps (A-B)

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  V-103

  	
   

  	
  Data Sheet - LNG Terminal
  BOG Compressor K.O. Drum (Elevation & Design)

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  V-104

  	
   

  	
  Data Sheet - LNG Terminal
  Liquid Drain Pot (Elevation & Design)

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  V-105-107-108

  	
   

  	
  Data Sheet – Air Receiver
  Vessel Design

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  V-111

  	
   

  	
  Data Sheet - LNG Terminal
  BOG Condenser Drum (A-B)

  	
   

  	
  P

  	
   

  	
  Contractor

  	
   

  	
  Study

  

 

77

 

	
   

  	
   

  	
  V-115

  	
   

  	
  Data Sheet – Nitrogen
  Receiving Vessel Design (Vertical)

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  Z-101

  	
   

  	
  Data Sheet - Flare System -
  HP Vent Stack

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  Z-102

  	
   

  	
  Data Sheet - Flare System -
  LP Vent Stack

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  E-102A/B/C

  	
   

  	
  Fuel Gas Electric Heater

  	
   

  	
   

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  G-101A-E

  	
   

  	
  Gas Turbine Generators

  	
   

  	
  0

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  P-120A/B

  	
   

  	
  Caustic Charge Pumps

  	
   

  	
   

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  P-121A/B

  	
   

  	
  Caustic Supply Pumps

  	
   

  	
   

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  S-110

  	
   

  	
  Caustic Storage Tank

  	
   

  	
   

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  V-120

  	
   

  	
  Turbine Generator Fuel Gas
  KO Drum

  	
   

  	
   

  	
   

  	
  Contractor

  	
   

  	
   

  
	
  CIVIL
  STRUCTURAL ARCHITECHTURAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Civil/Site

  	
   

  	
  01-0005A

  	
   

  	
  Roads, Surface, Drainage
  & Fence Plan

  	
   

  	
  E1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  01-0005B

  	
   

  	
  Spill Containment Plan

  	
   

  	
  E1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  9/23/2003

  	
   

  	
  Civil Estimate Design Basis

  	
   

  	
   

  	
   

  	
  B&V

  	
   

  	
   

  
	
  Buildings

  	
   

  	
  SK-02-101

  	
   

  	
  Control Building Plan -
  Ground Floor

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-101A

  	
   

  	
  Control Building Plan - 2nd
  Floor

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-101B

  	
   

  	
  Control Building Elevations

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-101C

  	
   

  	
  Control Building Elevations

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-102

  	
   

  	
  Administration Bldg. Plan

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-102A

  	
   

  	
  Administration Bldg.
  Elevations

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-03-103

  	
   

  	
  Firewater Pumphouse
  Elevations

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-104

  	
   

  	
  Warehouse/Maintenance Bldg.

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-105

  	
   

  	
  Stand - By Generator
  Shelter

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-106

  	
   

  	
  Jetty Electrical Bldg. Plan

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-107

  	
   

  	
  Compressor Enclosure

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-108

  	
   

  	
  Gate House Plan &
  Elevation

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK-02-109

  	
   

  	
  Customs/Marine Building

  	
   

  	
  P2

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Building Scope of Work

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
  ELECTRICAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Electrical
  Load List

  	
   

  	
  6/25/04

  	
   

  	
  Load Summary - Sabine

  	
   

  	
  R9

  	
   

  	
  Contractor

  	
   

  	
   

  
	
  Single
  Lines

  	
   

  	
  SK-SP-1000

  	
   

  	
  One-Line Diagram

  	
   

  	
  A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
  Area
  Classifications

  	
   

  	
  12-0004

  	
   

  	
  Electrical Area
  Classification Plan

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Environmental

  	
   

  	
  11/17/2003 - 1

  	
   

  	
  Email - Color IR
  DG111704.msg

  	
   

  	
   

  	
   

  	
  Owner

  	
   

  	
   

  
	
   

  	
   

  	
  11/17/2003 - 2

  	
   

  	
  Email - Color IR DG111703
  Wetlands (2 of 3) Photo

  	
   

  	
   

  	
   

  	
  Owner

  	
   

  	
   

  
	
   

  	
   

  	
  11/17/2003 - 3

  	
   

  	
  Email - Color IR DG111703
  Wetlands (3 of 3) Photo

  	
   

  	
   

  	
   

  	
  Owner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Firewater
  & Gas Detection

  	
   

  	
  12-0008A

  	
   

  	
  Electrical/Instrument Plan
  Fire & Gas Detection

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  12-0008B

  	
   

  	
  Electrical./Instrument Plan
  Communications & Video Monitoring

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  12-0008C

  	
   

  	
  Electrical/Instrument Plan
  SIS Pushbuttons

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  

 

78

 

	
   

  	
   

  	
  11-0101N

  	
   

  	
  Firewater Coverage Overall
  Plan

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101P

  	
   

  	
  Firewater Coverage Process
  Area

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Piping

  	
   

  	
  SK-SP-00001

  	
   

  	
  Plot Plan

  	
   

  	
  00F

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  01-0102G

  	
   

  	
  Equipment & Piping
  Elevation West Jetty

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  01-0102E

  	
   

  	
  Equipment & Piping Elevation
  East Jetty

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101

  	
   

  	
  Piperack Piping Index

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101A

  	
   

  	
  Piping Section Piperack “A”
  West Jetty

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101B

  	
   

  	
  Piping Section Piperack “B”
  East Jetty

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101C

  	
   

  	
  Piping Section Piperack “C”
  Jetty

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101D

  	
   

  	
  Piping Section “D” Main
  Piperack @ Vaporizers

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101E

  	
   

  	
  Piping Section “E” South
  Vaporizers Sections

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101F

  	
   

  	
  Piping Section “F” Main
  Rack @ Vapor. & Compr.

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101G

  	
   

  	
  Piping Section “G” Main
  Piperack to Storage Tanks Section

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101H

  	
   

  	
  Piping Section “H” Piperack
  to S-101

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101J

  	
   

  	
  Piping Section “J” Piperack
  to S-102

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101K

  	
   

  	
  Piping Section “J” Piperack
  to S-103

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101L

  	
   

  	
  Piping Arrangement Jetty
  Junction Area

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  11-0101M

  	
   

  	
  Firewater Coverage Overall
  Plan

  	
   

  	
  E

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  SK0100

  	
   

  	
  Tank Top Out

  	
   

  	
  P

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Specifications

  	
   

  	
  134882-11.01X

  	
   

  	
  Piping Material
  Specification & Appendix

  	
   

  	
  P1

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
  3PS-NN00-F0002

  	
   

  	
  Cold Insulation

  	
   

  	
  A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Utility

  	
   

  	
   

  	
   

  	
  Preliminary Utility Summary

  	
   

  	
   

  	
   

  	
  B&V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Marine
  Facilities

  	
   

  	
  9995.102

  	
   

  	
  Base Load Diagram

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
  SM (Shiner – Mosley)

  
	
   

  	
   

  	
  10296.001

  	
   

  	
  Operating Envelope Four
  Arms 20” x 50’ FP DCMA “S”

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Design Basis TOC &
  Narrative

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-01

  	
   

  	
  Cover Sheet & Index

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-02

  	
   

  	
  Hydrographic Survey

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-03

  	
   

  	
  Berth Layout/Shoreline
  Protection Plan

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-04

  	
   

  	
  Dredging Plan

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-05

  	
   

  	
  Dredged Material Placement
  Are Plan

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-06

  	
   

  	
  Typical Dredging Sections

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-07

  	
   

  	
  Shoreline Protection
  Details

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-08

  	
   

  	
  East Jetty Layout

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-09

  	
   

  	
  West Jetty Layout

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-10

  	
   

  	
  East Jetty Platform Layout

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-11

  	
   

  	
  West Jetty Platform Layout

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-12

  	
   

  	
  East/West Jetty Platform
  Elev.

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  

 

79

 

	
   

  	
   

  	
  30176-05-13

  	
   

  	
  East/West Jetty
  Pile/Framing

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-14

  	
   

  	
  East Approach/Pipe Trestle
  Plan & Sections

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-15

  	
   

  	
  West Approach/Pipe Trestle
  Plan & Sections

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-16

  	
   

  	
  East Approach/Pipe Trestle
  Plan & Sections

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-17

  	
   

  	
  West Approach/Pipe Trestle
  Plan & Sections

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-18

  	
   

  	
  Approach/Pipe Trestle
  Details

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-19

  	
   

  	
  Mooring Structure

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-20

  	
   

  	
  Inner Breasting Structure

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-21

  	
   

  	
  Outer Breasting Structure

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-22

  	
   

  	
  Catwalk Details

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-23

  	
   

  	
  Tug Berth Plan &
  Sections

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  30176-05-24

  	
   

  	
  Aids to Navigation

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
  Marine
  Facilities Specifications

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  01300

  	
   

  	
  Spec - Submittals

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02211

  	
   

  	
  Spec - Earth Embankment

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02275

  	
   

  	
  Spec - Geotextile Filter
  Fabric

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02300

  	
   

  	
  Spec - Pile Driving

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02301

  	
   

  	
  Spec - Steel Pipe Piling

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02303

  	
   

  	
  Spec - Steel Sheet Piling

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02850

  	
   

  	
  Spec - Graded Rock Riprap

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02900

  	
   

  	
  Spec - Aids to Navigation
  (ATONS)

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02935

  	
   

  	
  Spec - Articulating Block
  Mat Revetment

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  02940

  	
   

  	
  Spec - Dredging

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  03100

  	
   

  	
  Spec - Berthing Facility -
  Concrete Formwork

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  03200

  	
   

  	
  Spec - Concrete
  Reinforcement

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  03300

  	
   

  	
  Spec - Cast-In-Place
  Concrete

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  03346

  	
   

  	
  Spec - Concrete Finishing

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  03430

  	
   

  	
  Spec - Precast, Prestressed
  Concrete

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  05100

  	
   

  	
  Spec - Structural Steel and
  Hardware

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  05127

  	
   

  	
  Spec - Steel Fabrications
  & Miscellaneous Steel

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  09801

  	
   

  	
  Spec - Galvanizing

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  09910

  	
   

  	
  Spec - Coal Tar Epoxy
  Coating

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  10101

  	
   

  	
  Spec - Dock Fenders

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  11551

  	
   

  	
  Spec - Vessel Access Tower

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  11552

  	
   

  	
  Spec - Quick Release
  Mooring Hook Assemblies

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  14600

  	
   

  	
  Spec - Small Boat Davit

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
  CONSTRUCTION
  DOCK

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit D

  	
   

  	
  Construction Dock Scope of
  Work

  	
   

  	
   

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  Spec 02211

  	
   

  	
  Earth Embankment

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  Spec 02275

  	
   

  	
  Geotextile Filter Fabric

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  Spec 02935

  	
   

  	
  Articulating Block Mat
  Revetment

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  Spec 09910

  	
   

  	
  Coat Tar Epoxy

  	
   

  	
   

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  —

  	
   

  	
  Geotechnical Report Summary

  	
   

  	
   

  	
   

  	
  T-W

  	
   

  	
   

  

 

80

 

	
   

  	
   

  	
  SK-CD-001

  	
   

  	
  Preliminary Site Plan
  Construction Dock

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-002

  	
   

  	
  Section at Permanent
  Construction Dock

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-003

  	
   

  	
  Typical Section “A” Frame
  and Bulkhead

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-004

  	
   

  	
  Typical Details for
  Construction

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-005

  	
   

  	
  Typical Details for
  Construction

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-006

  	
   

  	
  Typical Details for
  Construction

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-007

  	
   

  	
  Typical Details for
  Construction

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-008

  	
   

  	
  Typical Details for
  Construction

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-009

  	
   

  	
  Typical Details for
  Construction

  	
   

  	
  A

  	
   

  	
  SM

  	
   

  	
   

  
	
   

  	
   

  	
  CG-000-00020

  	
   

  	
  Construction Dock Section
  and Details

  	
   

  	
  A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  CD-000-00015

  	
   

  	
  Rough Grading Sedimentation
  Control Details

  	
   

  	
  A

  	
   

  	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
  SK-CD-010

  	
   

  	
  Sabine Pass Site Plan

  	
   

  	
  F

  	
   

  	
  Contractor

  	
   

  	
   

  

 

81

 

Trends List

 

The following trends were identified by the Contractor during
preparation of the Contract Price, are incorporated into the Scope of Work by
reference, and are specifically included in the Contract Price.  The documents listed shall control over any
conflicting Drawing or Specification listed in this Schedule A-3.

 

	
  TREND NUMBER

  	
   

  	
  DESCRIPTION

  
	
  T-SP-002

  	
   

  	
  Change recondensor drum from 1-100% to 2-50%
  capacity

  
	
  T-SP-004

  	
   

  	
  Use of Caustic for SCV pH control in lieu of sodium
  carbonate

  
	
  T-SP-005

  	
   

  	
  Solar Titan-130 Power Generator TIC & Meter,
  Regulator, Controls

  
	
  T-SP-006

  	
   

  	
  Chromatograph for Marine Terminal

  
	
  T-SP-008

  	
   

  	
  Lighthouse Road Improvements

  
	
  T-SP-009

  	
   

  	
  Plot Plan Changes, Road Crossings of Pipe Racks,
  tec.

  
	
  T-SP-010

  	
   

  	
  Additional Fire Monitor & Tower on Marine
  Terminal

  
	
  T-SP-011

  	
   

  	
  PFD & SIS addition due to Hazop Review

  
	
  T-SP-013

  	
   

  	
  Increase 24” outlet line from vaporizers to master
  meter to 36”

  
	
  T-SP-014

  	
   

  	
  Construction Water for batch plant and dust control

  
	
  T-SP-015

  	
   

  	
  Civil work north of LNG Tanks for soil improvement

  
	
  T-SP-017

  	
   

  	
  Add signage, striping & barricades to site prep
  sub contract

  
	
  T-SP-021

  	
   

  	
  Increase Marine piperack width for pre-investment
  space for pipe

  
	
  T-SP-022

  	
   

  	
  Pre-Investment for 20% more electrical breakers
  space & building

  
	
  T-SP-024

  	
   

  	
  Pre-Investment List of Requirements & cryogenic
  tie-ins

  
	
  T-SP-028

  	
   

  	
  EPC Contractor Startup, Commissioning &
  Operations

  
	
  T-SP-029

  	
   

  	
  Fire Proofing of Structures

  
	
  T-SP-030

  	
   

  	
  Interplatforms on Vaporizers

  
	
  T-SP-031

  	
   

  	
  Define Allowance for SIS

  
	
  T-SP-032

  	
   

  	
  Back Pressure Regulation on plant outlet

  
	
  T-SP-033

  	
   

  	
  Building Review and Additional Space Requirements

  
	
  T-SP-036

  	
   

  	
  Gaitronics Plant PA System

  
	
  T-SP-037

  	
   

  	
  Water Supply to tug berth

  
	
  T-SP-040

  	
   

  	
  Redundant Offsite Communications

  
	
  T-SP-041

  	
   

  	
  Pipe sleeves under roads and parking lots for irrigation
  lines

  
	
  T-SP-044

  	
   

  	
  Single Fuel Gas Supply and Meter for SCV’s

  
	
  T-SP-047

  	
   

  	
  Sanitary Sewer Outfall

  
	
  T-SP-048

  	
   

  	
  Modifications to Card Reader & CCTV from B&V
  design

  
	
  T-SP-049

  	
   

  	
  Perimeter Fence Lighting

  
	
  T-SP-052

  	
   

  	
  3 Additional Site personnel at site from 7 to 10,
  office space, etc

  
	
  T-SP-053

  	
   

  	
  Reimbursed Person to keep up with sales tax
  computations

  
	
  T-SP-060

  	
   

  	
  Ship to Shore Imbelical Cord for communications
  & ESD

  
	
  T-SP-061

  	
   

  	
  Add in-tank pump discharge block valves

  
	
  T-SP-063

  	
   

  	
  Boiler Monitoring requirements

  
	
  T-SP-065

  	
   

  	
  Impact of pressure drop on equip design and added
  power requirements

  
	
  T-SP-067

  	
   

  	
  Remote operating N2 snuffing valve

  
	
  T-SP-069

  	
   

  	
  Early start schedule

  
	
  T-SP-070

  	
   

  	
  LNG Tanks

  

 

82

 

	
  T-SP-071

  	
   

  	
  Marine Facilities

  
	
  T-SP-072

  	
   

  	
  Site preparation - revised subcontractor pricing

  
	
  T-SP-073

  	
   

  	
  Soil improvement - revised subcontractor pricing

  
	
  EA-SP-002

  	
   

  	
  Correction to vendor supplied (IPS) pricing for CS
  and SS Spool pipe

  
	
  EA-SP-003

  	
   

  	
  Recalc escalation for piping and freight

  
	
  EA-SP-004

  	
   

  	
  Discharge of water from LNG tanks (concrete/rip rap
  materials)

  
	
  EA-SP-005

  	
   

  	
  Consultant cost

  

 

83

 

ATTACHMENT
B

 

CONTRACTOR
DELIVERABLES

 

1.1                               Document
Formats

 

Contractor shall provide
engineering, procurement, construction and operating and maintenance
documentation for all aspects of the Work. 
Documents developed by Contractor and Major Subcontractors shall conform
to the following:

 

1.               Contractor shall use industry standard 2D and/or 3D
computer aided drawing systems (CAD). All final 2D CAD Drawing files generated
by the Contractor must be compatible with 2D AutoCAD format.  File levels (layers) of drawing attributes
shall be retained in the original level structure and intelligence, wherever
practical.

 

2.               Software used for word processing shall be Microsoft
Word.

 

3.               Software used for spreadsheets shall be Microsoft
Excel.

 

4.               Hand-written documentation shall be minimized.

 

5.               All documents shall be produced in a clear readable
and reproducible manner.

 

6.               Each page of the document shall carry the document
number, revision, and a sequential page number.

 

7.               Software used for scheduling shall be compatible with
Primavera or Microsoft Project.

 

8.               Databases shall be compatible with Microsoft Access or
Oracle.

 

1.2                               Progress
Reviews

 

During the development of the
Drawings and Specifications, Contractor shall provide Owner with reasonable
opportunity to perform reviews of the design and engineering in progress.  Such reviews may be conducted at Contractor’s
office located in Houston, Texas or at any of its Major Subcontractor’s
offices.  The reviews may be of progress
prints, computer images, draft documents, working calculations, draft
specifications or reports, Drawings, Specifications or other design documents as
agreed to by Contractor and Owner.  The
Parties acknowledge that any Owner instructions to Contractor during such
reviews will have no effect unless Owner provides such instructions in writing
to Contractor or unless Contractor provides notice of the instruction and
Contractor’s compliance to Owner and Owner fails to object.

 

1.3                               Documents
for Owner Approval

 

In addition to any other
documents which Contractor is required by the other provisions of the Agreement
to provide for Owner’s approval, Contractor shall submit copies of the
following document, Drawings and Specifications to Owner for formal review,
comment, and approval.

 

B-1

 

a.               Process
flow diagrams (PFDs) with heat and material balances

 

b.              Piping
and Instrument Diagrams (P&IDs)

 

c.               HAZOP
reports

 

d.              Plot
plans

 

e.               Equipment
location plans

 

f.                 Piping
layouts (from the 3D model)

 

g.              Bidders
lists

 

h.              Electrical
area classification drawings

 

i.                  Building
layouts

 

j.                  Material
selection guide

 

k.               Facility
Performance Test reports

 

1.4                               Documents
for Owner Review

 

In addition to any other
documents which Contractor is required by the other provisions of the Agreement
to provide for Owner’s review, Contractor shall submit copies of the following
documents, Drawings and Specifications to Owner for review and comment.  These documents are not subject to Owner approval;
however, Contractor will consider all Owner comments.  In addition, Owner may select other documents
with the agreement of Contractor.

 

a.               Piping
Specifications

 

b.              Underground
piping plans

 

c.               3-D
model

 

d.              Equipment
lists

 

e.               Electrical
one-line diagrams

 

f.                 Minutes
and reports of HAZOP reviews and management of change reviews

 

g.              Minutes
and reports of safety integrity level (SIL) meetings

 

h.              Key
plans

 

i.                  Electrical
area classification Drawings

 

j.                  Equipment
data sheets

 

B-2

 

k.               Equipment
Specifications

 

l.                  Standard
detail Drawings

 

m.            Corrosion
control Specifications

 

n.              Painting
and coating Specifications and charts

 

o.              Insulation
system Specifications

 

p.              Technical
evaluation for all materials and Equipment

 

q.              Acceptance
test procedures for all Major Equipment and packages.

 

l.                  Factory
acceptance test reports

 

r.                 Recommended
spare parts lists

 

s.               For
reimbursable purchases, a complete commercial and technical evaluation

 

1.5                               Review
Periods

 

Owner shall have up to ten (10)
Business Days from its receipt of the documents listed in Sections 1.3 and 1.4
above, to issue to Contractor written comments on such documents, Drawings and
Specifications.  Owner will annotate the
Drawings and Specifications as appropriate and return to Contractor.  In the event that Owner disapproves the
Drawings or Specifications, Owner shall provide Contractor with a written
statement of the reasons for such rejection within the time period required for
Owner’s response, and Contractor shall provide Owner with agreed to revised and
corrected Drawings and Specifications as soon as possible thereafter.

 

1.6                               Record
Drawings and Specifications

 

Contractor shall deliver to
Owner the documents, Record Drawings and Specifications listed in (a) through
(i) below.  All Record Drawings shall be
provided in their native formats, fully functioning in accordance with Section
1.1 above.  Scanned documents, “.pdf”,
and other non-editable formats are only acceptable for Subcontract (including
Supplier) records where Contractor can not obtain the native format, or where
approved as an exception by Owner.

 

Record Drawings and
Specifications shall be handed over in hard copy printed format, and in
electronic format by compact disks (CDs). 
CD’s shall have a specific index of CD contents on each CD in “Document
Register” format that includes the document number, title and revision.   CD’s shall be organized in a logical
structure by discipline.  A master index
shall be prepared to detail the contents of all handover CD’s listed by CD number
and contents.

 

Record Drawings shall be
inclusive of all design changes and field changes made up to Substantial
Completion with “Record Drawing” in the revision block or with an as-built
stamp.  Vendor prints to be review Code 1
(Work may proceed) or Code 4 (Review not required work

 

B-3

 

may proceed).  Hand annotations on CAD prepared Record
Drawings and Specifications are not permitted.

 

a.               Piping
and Instrument Diagrams (P&IDs)

 

b.              Plot
plans

 

c.               Underground
plans

 

d.              Electrical
area classification Drawings

 

e.               One-line
diagrams

 

f.                 Start
up, operating and maintenance manuals

 

g.              Vendor
data books

 

h.              Performance
Test reports (required to be delivered with Substantial Completion Certificate)

 

1.7                               Turnover
Documents

 

Contractor shall deliver to
Owner the turnover documents listed in (a) through (k) below.  All turnover documents shall be provided in
their native formats, fully functioning in accordance with Section 1.1 above;
however turnover documents may contain clearly legible hand annotations if
necessary provided a scanned or “.pdf” files of the annotated document is also
provided along with the native file. 
Scanned documents, “.pdf”, and other non-editable formats are acceptable
for Subcontract (including supplier) 
records where Contractor cannot obtain the native format, or where
approved as an exception by Owner.

 

Turnover documents shall be
handed over in hard copy printed format, and in electronic format by compact
disks (CDs).  CD’s shall have a specific
index of CD contents on each CD in “Document Register” format that includes the
document number, title and revision.. 
CD’s shall be organized in a logical structure by discipline.  A master index shall be prepared to detail
the contents of all handover CD’s listed by CD number and contents.

 

Turnover Documents shall be the
last revision issued by Contractor

 

a.               Process
flow diagrams (PFDs) and heat and material balances

 

b.              Equipment
location plans

 

c.               Key
plans

 

B-4

 

d.              Cabling
plans

 

e.               Piping
Specifications

 

f.                 Painting
and insulation summaries

 

g.              Building
layouts

 

h.              Equipment
data sheets

 

i.                  Material
selection guide

 

j.                  Quality
records and certification documentation

 

k.               Tie-in
Drawings

 

l.                  Equipment
list

 

m.            Instrument
list

 

n.              Line
list

 

B-5

 

Attachment
C - Payment Schedule

 

 

SCHEDULE C-1  MILESTONE PAYMENT SCHEDULE

SABINE PASS LNG RECEIVING
TERMINAL

 

	
  Contract Price

  	
  $

  	
  646,936,000

  
	
  Monthly Payments

  	
  $

  	
  194,080,800

  
	
  Milestone Allotment

  	
  $

  	
  452,855,200

  

 

	
  Milestone

  Number

  	
   

  	
  Description

  	
   

  	
  Milestone

  Percentage

  	
   

  	
  Cumulative

  Value

  	
   

  	
  Milestone

  Value

  	
   

  
	
  1.01

  	
   

  	
  Deliver
  Performance Letter of Credit & Payment Letter of Credit

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  1.02

  	
   

  	
  Place
  insurance coverage

  	
   

  	
  1.00

  	
  %

  	
  1.50

  	
  %

  	
  $

  	
  6,469,360

  	
   

  
	
  1.03

  	
   

  	
  Issue
  Project Execution Plan to Owner

  	
   

  	
  0.50

  	
  %

  	
  2.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  1.04

  	
   

  	
  PFDs issued
  for design

  	
   

  	
  0.50

  	
  %

  	
  2.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  1.05

  	
   

  	
  Process
  P&IDs IFA

  	
   

  	
  0.50

  	
  %

  	
  3.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  1.06

  	
   

  	
  Soils improvement
  Subcontract awarded

  	
   

  	
  0.50

  	
  %

  	
  3.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  2.01

  	
   

  	
  Process
  P&IDs IFH

  	
   

  	
  0.50

  	
  %

  	
  4.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  2.02

  	
   

  	
  LNG Tank
  Subcontract awarded

  	
   

  	
  0.50

  	
  %

  	
  4.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  2.03

  	
   

  	
  Issue piping
  Specifications for design

  	
   

  	
  0.50

  	
  %

  	
  5.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.01

  	
   

  	
  Marine works
  Subcontract awarded

  	
   

  	
  0.50

  	
  %

  	
  5.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.02

  	
   

  	
  Complete
  process P&IDs HAZOP reviews

  	
   

  	
  0.50

  	
  %

  	
  6.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.03

  	
   

  	
  Vaporizer
  purchase order awarded

  	
   

  	
  0.50

  	
  %

  	
  6.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.04

  	
   

  	
  Gas turbine
  generator purchase order awarded

  	
   

  	
  0.50

  	
  %

  	
  7.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.05

  	
   

  	
  Marine
  unloading arms puchase order awarded

  	
   

  	
  0.50

  	
  %

  	
  7.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.06

  	
   

  	
  Deliver
  quality assurance and inspection plan, excluding commissioning

  	
   

  	
  0.50

  	
  %

  	
  8.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.07

  	
   

  	
  Deliver
  initial CPM Schedule

  	
   

  	
  0.50

  	
  %

  	
  8.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.08

  	
   

  	
  Deliver
  Project Engineering Plan

  	
   

  	
  0.50

  	
  %

  	
  9.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  3.09

  	
   

  	
  Mobilize
  Construction Dock Subcontractor

  	
   

  	
  0.23

  	
  %

  	
  9.23

  	
  %

  	
  $

  	
  1,500,000

  	
   

  
	
  4.01

  	
   

  	
  Process
  P&IDs IFD

  	
   

  	
  0.50

  	
  %

  	
  9.73

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  4.02

  	
   

  	
  Site
  preparation Subcontract awarded

  	
   

  	
  0.50

  	
  %

  	
  10.23

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  4.03

  	
   

  	
  LNG Tank
  test piling started

  	
   

  	
  0.50

  	
  %

  	
  10.73

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  4.04

  	
   

  	
  LNG pumps
  purchase order awarded

  	
   

  	
  0.50

  	
  %

  	
  11.23

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  4.05

  	
   

  	
  Deliver
  inspection procedures

  	
   

  	
  0.50

  	
  %

  	
  11.73

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  5.01

  	
   

  	
  3D model
  review 30%

  	
   

  	
  0.50

  	
  %

  	
  12.23

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  5.02

  	
   

  	
  First
  commitment of vessels or drums

  	
   

  	
  0.50

  	
  %

  	
  12.73

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  5.03

  	
   

  	
  Boil-Off
  compressors purchase order awarded

  	
   

  	
  0.50

  	
  %

  	
  13.23

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  5.04

  	
   

  	
  Receive
  critical vendor prints - vaporizers

  	
   

  	
  0.50

  	
  %

  	
  13.73

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  5.05

  	
   

  	
  File Notice
  of Commencement in Louisiana Superior Court

  	
   

  	
  0.50

  	
  %

  	
  14.23

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  6.01

  	
   

  	
  Award
  building Subcontract

  	
   

  	
  0.50

  	
  %

  	
  14.73

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  6.02

  	
   

  	
  Purchase
  order for diesel generator awarded

  	
   

  	
  0.50

  	
  %

  	
  15.23

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  6.03

  	
   

  	
  Purchase
  order for fuel gas heaters awarded

  	
   

  	
  0.50

  	
  %

  	
  15.73

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  6.04

  	
   

  	
  Purchase
  order for instrument air compressor awarded

  	
   

  	
  0.50

  	
  %

  	
  16.23

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  6.05

  	
   

  	
  Complete
  Construction Dock Revetment

  	
   

  	
  0.46

  	
  %

  	
  16.70

  	
  %

  	
  $

  	
  3,000,000

  	
   

  
	
  7.01

  	
   

  	
  3D model
  review 50%

  	
   

  	
  0.50

  	
  %

  	
  17.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  7.02

  	
   

  	
  Prepare
  material requisition for pipe rack steel

  	
   

  	
  0.50

  	
  %

  	
  17.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  7.03

  	
   

  	
  Issue pipe
  rack piling location Drawings

  	
   

  	
  0.50

  	
  %

  	
  18.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  7.04

  	
   

  	
  Award Piling
  Subcontract

  	
   

  	
  0.50

  	
  %

  	
  18.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  7.05

  	
   

  	
  Deliver
  draft training program for Owner’s operators for review

  	
   

  	
  0.50

  	
  %

  	
  19.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  7.06

  	
   

  	
  Marine
  Subcontract mobilize for dredging

  	
   

  	
  0.50

  	
  %

  	
  19.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  7.07

  	
   

  	
  Deliver
  updated CPM Schedule

  	
   

  	
  0.50

  	
  %

  	
  20.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  8.01

  	
   

  	
  Equipment
  arrangement Drawings IFC (LNG Tanks)

  	
   

  	
  0.50

  	
  %

  	
  20.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  8.02

  	
   

  	
  Complete
  Major Equipment commitments (90%)

  	
   

  	
  0.50

  	
  %

  	
  21.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  8.03

  	
   

  	
  Electrical
  switchgear & transformer material requisition

  	
   

  	
  0.50

  	
  %

  	
  21.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  9.01

  	
   

  	
  Rack piping
  material requisition

  	
   

  	
  0.50

  	
  %

  	
  22.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  9.02

  	
   

  	
  Process
  P&IDs IFC

  	
   

  	
  0.50

  	
  %

  	
  22.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  9.03

  	
   

  	
  LNG Tank
  Subcontract mobilize & start piling for Tank 1

  	
   

  	
  0.50

  	
  %

  	
  23.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  9.04

  	
   

  	
  Instrument
  M/R - long lead control valves

  	
   

  	
  0.50

  	
  %

  	
  23.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  9.05

  	
   

  	
  Piling
  Subcontract mobilize & start piling

  	
   

  	
  0.50

  	
  %

  	
  24.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  9.06

  	
   

  	
  Complete
  Construction Dock

  	
   

  	
  0.50

  	
  %

  	
  24.70

  	
  %

  	
  $

  	
  3,236,000

  	
   

  
	
  10.01

  	
   

  	
  Pipe rack
  foundations IFC

  	
   

  	
  0.50

  	
  %

  	
  25.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  10.02

  	
   

  	
  Issue
  instrument index(for design)

  	
   

  	
  0.50

  	
  %

  	
  25.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  10.03

  	
   

  	
  Instrumentation
  MRs -relief valves

  	
   

  	
  0.50

  	
  %

  	
  26.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  10.04

  	
   

  	
  Start piling
  Tank 2

  	
   

  	
  0.50

  	
  %

  	
  26.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  11.01

  	
   

  	
  Piling
  completed for Tank 1

  	
   

  	
  0.50

  	
  %

  	
  27.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  11.02

  	
   

  	
  Purchase
  order for DCS awarded

  	
   

  	
  0.50

  	
  %

  	
  27.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  12.01

  	
   

  	
  Start issue
  Equipment foundations IFC

  	
   

  	
  0.50

  	
  %

  	
  28.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  12.02

  	
   

  	
  Rack steel
  Drawings IFC

  	
   

  	
  0.50

  	
  %

  	
  28.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  12.03

  	
   

  	
  Start issue
  instrument location Drawings

  	
   

  	
  0.50

  	
  %

  	
  29.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  12.04

  	
   

  	
  3D model 90%
  review

  	
   

  	
  0.50

  	
  %

  	
  29.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  12.05

  	
   

  	
  Complete
  piling Tank 2

  	
   

  	
  0.50

  	
  %

  	
  30.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  13.01

  	
   

  	
  Issue
  Metering Skid Material requisition

  	
   

  	
  0.50

  	
  %

  	
  30.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  13.02

  	
   

  	
  Start issue
  instrument details

  	
   

  	
  0.50

  	
  %

  	
  31.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  

 

 

	
  13.03

  	
   

  	
  Complete
  piling [Tank 3] (90%)

  	
   

  	
  1.00

  	
  %

  	
  32.20

  	
  %

  	
  $

  	
  6,469,360

  	
   

  
	
  13.04

  	
   

  	
  Start pipe
  rack foundations

  	
   

  	
  0.50

  	
  %

  	
  32.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  14.01

  	
   

  	
  Start
  process structure

  	
   

  	
  0.50

  	
  %

  	
  33.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  14.02

  	
   

  	
  Issue
  building foundation Drawings (90%)

  	
   

  	
  0.50

  	
  %

  	
  33.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  14.03

  	
   

  	
  Start issue
  fab pipe Isometrics

  	
   

  	
  0.50

  	
  %

  	
  34.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  14.04

  	
   

  	
  Marine
  Subcontract start dock construction

  	
   

  	
  1.00

  	
  %

  	
  35.20

  	
  %

  	
  $

  	
  6,469,360

  	
   

  
	
  14.05

  	
   

  	
  Dredging
  completed

  	
   

  	
  0.50

  	
  %

  	
  35.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  15.01

  	
   

  	
  Start
  delivery gas turbine generators

  	
   

  	
  0.50

  	
  %

  	
  36.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  15.02

  	
   

  	
  Deliver
  diesel generator set

  	
   

  	
  0.50

  	
  %

  	
  36.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  15.03

  	
   

  	
  Fabricate
  & deliver first vaporizers

  	
   

  	
  0.50

  	
  %

  	
  37.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  15.04

  	
   

  	
  Pile cap
  installation complete Tank 1

  	
   

  	
  1.00

  	
  %

  	
  38.20

  	
  %

  	
  $

  	
  6,469,360

  	
   

  
	
  15.05

  	
   

  	
  Start
  delivery of large cryogenic valves

  	
   

  	
  0.50

  	
  %

  	
  38.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  16.01

  	
   

  	
  Start pipe
  rack steel erection

  	
   

  	
  0.50

  	
  %

  	
  39.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  16.02

  	
   

  	
  Issue
  electrical layout Drawings (90%)

  	
   

  	
  0.50

  	
  %

  	
  39.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  16.03

  	
   

  	
  Complete
  pile cap installation Tank 2

  	
   

  	
  1.00

  	
  %

  	
  40.70

  	
  %

  	
  $

  	
  6,469,360

  	
   

  
	
  16.04

  	
   

  	
  Start
  delivery of instrumentation

  	
   

  	
  0.50

  	
  %

  	
  41.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  17.01

  	
   

  	
  Complete
  pile cap installation Tank 3

  	
   

  	
  0.50

  	
  %

  	
  41.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  17.02

  	
   

  	
  Deliver LNG
  pumps

  	
   

  	
  0.50

  	
  %

  	
  42.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  18.01

  	
   

  	
  Start rack
  piping

  	
   

  	
  0.50

  	
  %

  	
  42.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  18.02

  	
   

  	
  Site
  preparation Subcontract Work completed

  	
   

  	
  0.50

  	
  %

  	
  43.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  18.03

  	
   

  	
  First
  delivery of rack pipe

  	
   

  	
  0.50

  	
  %

  	
  43.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  18.04

  	
   

  	
  Process area
  concrete structure complete (90%)

  	
   

  	
  0.50

  	
  %

  	
  44.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  19.01

  	
   

  	
  Power
  generation area foundations complete (90%)

  	
   

  	
  0.50

  	
  %

  	
  44.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  19.02

  	
   

  	
  Start
  Equipment installation

  	
   

  	
  0.50

  	
  %

  	
  45.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  19.03

  	
   

  	
  Deliver
  transformers

  	
   

  	
  0.50

  	
  %

  	
  45.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  20.01

  	
   

  	
  Marine berth
  construction complete

  	
   

  	
  0.50

  	
  %

  	
  46.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  20.02

  	
   

  	
  Complete
  structural steel delivery (90%)

  	
   

  	
  0.50

  	
  %

  	
  46.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  20.03

  	
   

  	
  Award
  insulation Subcontract technical package

  	
   

  	
  0.50

  	
  %

  	
  47.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  20.04

  	
   

  	
  Deliver
  Boil-Off compressor

  	
   

  	
  0.50

  	
  %

  	
  47.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  21.01

  	
   

  	
  Deliver
  fabricated pipe (90%)

  	
   

  	
  0.50

  	
  %

  	
  48.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  21.02

  	
   

  	
  DCS/SIS
  configuration at vendor shop

  	
   

  	
  0.50

  	
  %

  	
  48.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  21.03

  	
   

  	
  Fabricate
  and deliver piping valves (90%)

  	
   

  	
  0.50

  	
  %

  	
  49.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  21.04

  	
   

  	
  Outer tank
  shell plate complete Tank 1

  	
   

  	
  0.50

  	
  %

  	
  49.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  22.01

  	
   

  	
  Roof Raising
  Tank 1

  	
   

  	
  0.50

  	
  %

  	
  50.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  22.02

  	
   

  	
  Complete all
  foundations (90%)

  	
   

  	
  0.50

  	
  %

  	
  50.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  23.01

  	
   

  	
  Start bottom
  insulation system Tank 1

  	
   

  	
  0.50

  	
  %

  	
  51.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  23.02

  	
   

  	
  Last
  delivery of vaporizers

  	
   

  	
  0.50

  	
  %

  	
  51.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  23.03

  	
   

  	
  Start
  install fabricated pipe (spools)

  	
   

  	
  0.50

  	
  %

  	
  52.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  23.04

  	
   

  	
  Roof Raising
  Tank 2

  	
   

  	
  0.50

  	
  %

  	
  52.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  23.05

  	
   

  	
  Outer tank
  shell plate complete Tank 2

  	
   

  	
  0.50

  	
  %

  	
  53.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  24.01

  	
   

  	
  DCS FAT
  testing

  	
   

  	
  0.50

  	
  %

  	
  53.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  24.02

  	
   

  	
  Start bottom
  insulation system Tank 2

  	
   

  	
  0.50

  	
  %

  	
  54.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  24.03

  	
   

  	
  Outer tank
  shell plate complete Tank 3

  	
   

  	
  0.50

  	
  %

  	
  54.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  25.01

  	
   

  	
  Commence
  pipe rack electrical tray

  	
   

  	
  0.50

  	
  %

  	
  55.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  25.02

  	
   

  	
  Set first vaporizer

  	
   

  	
  0.50

  	
  %

  	
  55.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  25.03

  	
   

  	
  Roof raising
  Tank 3

  	
   

  	
  0.50

  	
  %

  	
  56.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  25.04

  	
   

  	
  Deliver
  Performance Test Procedures

  	
   

  	
  0.50

  	
  %

  	
  56.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  26.01

  	
   

  	
  Start bottom
  insulation system Tank 3

  	
   

  	
  0.50

  	
  %

  	
  57.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  26.02

  	
   

  	
  Award
  insulation Subcontract

  	
   

  	
  0.50

  	
  %

  	
  57.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  27.01

  	
   

  	
  Power
  generation area Equipment installed (90%)

  	
   

  	
  0.50

  	
  %

  	
  58.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  27.02

  	
   

  	
  Complete
  erection of 90% pipe rack steel

  	
   

  	
  0.50

  	
  %

  	
  58.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  27.03

  	
   

  	
  Complete
  containment swales (90%)

  	
   

  	
  0.50

  	
  %

  	
  59.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  28.01

  	
   

  	
  Building
  Subcontract Work completed (90%)

  	
   

  	
  0.50

  	
  %

  	
  59.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  28.02

  	
   

  	
  Power
  generation piping 90% complete

  	
   

  	
  0.50

  	
  %

  	
  60.20

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  28.03

  	
   

  	
  Deliver
  metering skid

  	
   

  	
  0.50

  	
  %

  	
  60.70

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  29.01

  	
   

  	
  Marine area
  piping 90% complete

  	
   

  	
  0.39

  	
  %

  	
  61.08

  	
  %

  	
  $

  	
  2,498,680

  	
   

  
	
  29.02

  	
   

  	
  Deliver
  Project Commissioning Plan

  	
   

  	
  0.35

  	
  %

  	
  61.43

  	
  %

  	
  $

  	
  2,234,680

  	
   

  
	
  30.01

  	
   

  	
  Power
  generation I&E complete (90%)

  	
   

  	
  0.35

  	
  %

  	
  61.77

  	
  %

  	
  $

  	
  2,234,680

  	
   

  
	
  31.01

  	
   

  	
  Startup
  power generation

  	
   

  	
  0.35

  	
  %

  	
  62.12

  	
  %

  	
  $

  	
  2,234,680

  	
   

  
	
  31.02

  	
   

  	
  Deliver
  interim operations plan

  	
   

  	
  0.35

  	
  %

  	
  62.46

  	
  %

  	
  $

  	
  2,234,680

  	
   

  
	
  32.01

  	
   

  	
  Tank 1
  erection complete

  	
   

  	
  0.35

  	
  %

  	
  62.81

  	
  %

  	
  $

  	
  2,234,680

  	
   

  
	
  33.01

  	
   

  	
  Complete
  hydro test LNG Tank 1

  	
   

  	
  0.35

  	
  %

  	
  63.15

  	
  %

  	
  $

  	
  2,234,680

  	
   

  

 

 

	
  34.01

  	
   

  	
  Marine area
  I&E 90% complete

  	
   

  	
  0.35

  	
  %

  	
  63.50

  	
  %

  	
  $

  	
  2,234,680

  	
   

  
	
  34.02

  	
   

  	
  Deliver
  90-day notice for RFCD

  	
   

  	
  0.50

  	
  %

  	
  64.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  34.03

  	
   

  	
  Deliver
  recommended Operating Spare Parts List

  	
   

  	
  0.50

  	
  %

  	
  64.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  35.01

  	
   

  	
  Complete
  Hydro test Tank 2

  	
   

  	
  0.50

  	
  %

  	
  65.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  36.01

  	
   

  	
  Complete
  ponds/ditches (90%)

  	
   

  	
  0.50

  	
  %

  	
  65.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  36.02

  	
   

  	
  Complete
  Hydro test Tank 3

  	
   

  	
  0.50

  	
  %

  	
  66.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  37.01

  	
   

  	
  Achieve RFCD

  	
   

  	
  0.50

  	
  %

  	
  66.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  37.02

  	
   

  	
  Deliver
  90-day notice for Performance Testing

  	
   

  	
  0.50

  	
  %

  	
  67.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  38.01

  	
   

  	
  Complete
  dikes around Tank 2

  	
   

  	
  0.50

  	
  %

  	
  67.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  38.02

  	
   

  	
  Tank 2
  available for Cool Down

  	
   

  	
  0.50

  	
  %

  	
  68.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  39.01

  	
   

  	
  Tank 3
  available for Cool Down

  	
   

  	
  0.50

  	
  %

  	
  68.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  40.01

  	
   

  	
  Facility achieves
  Ready for Performance Testing

  	
   

  	
  0.50

  	
  %

  	
  69.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  41.01

  	
   

  	
  Complete
  Performance Testing and achieve Substantial Completion

  	
   

  	
  0.50

  	
  %

  	
  69.50

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
  42.01

  	
   

  	
  Complete
  Punchlist and achieve Final Completion

  	
   

  	
  0.50

  	
  %

  	
  70.00

  	
  %

  	
  $

  	
  3,234,680

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  70.00

  	
  %

  	
   

  	
   

  	
  $

  	
  452,855,200

  	
   

  

 

 

SCHEDULE C-2 MONTHLY PAYMENT SCHEDULE

SABINE PASS
LNG RECEIVING TERMINAL

 

	
  Contract Price

  	
  $

  	
  646,936,000

  
	
  Monthly Payments

  	
  $

  	
  194,080,800

  
	
  Milestone Allotment

  	
  $

  	
  452,855,200

  

 

	
  Month #

  	
   

  	
   

  	
   

  	
  Percent

  	
   

  	
  Payment

  	
   

  
	
  From

  NTP

  	
   

  	
  Month

  	
   

  	
  Advance

  Payment

  	
   

  	
  Monthly

  Payment

  	
   

  	
  Incremental

  Payments

  	
   

  	
  Cumulative

  Payments

  	
   

  	
  Advance

  Payment

  	
   

  	
  Monthly

  Payment

  	
   

  	
  Milestone

  Payments

  	
   

  	
  Total

  Payments

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LNTP

  	
  -3

  	
   

  	
  Jan-05

  	
   

  	
   

  	
   

  	
  0.19

  	
  %

  	
  0.19

  	
  %

  	
  0.19

  	
  %

  	
   

  	
   

  	
  $

  	
  1,229,178

  	
   

  	
   

  	
   

  	
  $

  	
  1,229,178

  	
   

  
	
   

  	
  -2

  	
   

  	
  Feb-05

  	
   

  	
   

  	
   

  	
  0.31

  	
  %

  	
  0.31

  	
  %

  	
  0.50

  	
  %

  	
   

  	
   

  	
  $

  	
  2,005,502

  	
   

  	
   

  	
   

  	
  $

  	
  2,005,502

  	
   

  
	
   

  	
  -1

  	
   

  	
  Mar-05

  	
   

  	
   

  	
   

  	
  0.22

  	
  %

  	
  0.22

  	
  %

  	
  0.72

  	
  %

  	
   

  	
   

  	
  $

  	
  1,423,259

  	
   

  	
   

  	
   

  	
  $

  	
  1,423,259

  	
   

  
	
  NTP

  	
   

  	
   

  	
  1-Apr-05

  	
   

  	
  5.00

  	
  %

  	
   

  	
   

  	
  5.00

  	
  %

  	
  5.72

  	
  %

  	
  $

  	
  32,346,800

  	
   

  	
  $

  	
  —

  	
   

  	
   

  	
   

  	
  $

  	
  32,346,800

  	
   

  
	
   

  	
  1

  	
   

  	
  Apr-05

  	
   

  	
  -0.42

  	
  %

  	
  1.80

  	
  %

  	
  1.38

  	
  %

  	
  7.10

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  11,644,848

  	
   

  	
  $

  	
  22,642,760

  	
   

  	
  $

  	
  31,592,041

  	
   

  
	
   

  	
  2

  	
   

  	
  May-05

  	
   

  	
  -0.42

  	
  %

  	
  1.92

  	
  %

  	
  1.50

  	
  %

  	
  8.60

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  12,399,607

  	
   

  	
  $

  	
  9,704,040

  	
   

  	
  $

  	
  19,408,080

  	
   

  
	
   

  	
  3

  	
   

  	
  Jun-05

  	
   

  	
  -0.42

  	
  %

  	
  1.92

  	
  %

  	
  1.50

  	
  %

  	
  10.10

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  12,399,607

  	
   

  	
  $

  	
  27,377,440

  	
   

  	
  $

  	
  37,081,480

  	
   

  
	
   

  	
  4

  	
   

  	
  Jul-05

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.20

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  16,173,400

  	
   

  	
  $

  	
  16,820,336

  	
   

  
	
   

  	
  5

  	
   

  	
  Aug-05

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.30

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  16,173,400

  	
   

  	
  $

  	
  16,820,336

  	
   

  
	
   

  	
  6

  	
   

  	
  Sep-05

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.40

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  15,938,720

  	
   

  	
  $

  	
  16,585,656

  	
   

  
	
   

  	
  7

  	
   

  	
  Oct-05

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.50

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  22,642,760

  	
   

  	
  $

  	
  23,289,696

  	
   

  
	
   

  	
  8

  	
   

  	
  Nov-05

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.60

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  9,704,040

  	
   

  	
  $

  	
  10,350,976

  	
   

  
	
   

  	
  9

  	
   

  	
  Dec-05

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.70

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  19,409,400

  	
   

  	
  $

  	
  20,056,336

  	
   

  
	
   

  	
  10

  	
   

  	
  Jan-06

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.80

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  13,585,656

  	
   

  
	
   

  	
  11

  	
   

  	
  Feb-06

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  10.90

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  7,116,296

  	
   

  
	
   

  	
  12

  	
   

  	
  Mar-06

  	
   

  	
  -0.42

  	
  %

  	
  0.52

  	
  %

  	
  0.10

  	
  %

  	
  11.00

  	
  %

  	
  $

  	
  (2,695,567

  	
  )

  	
  $

  	
  3,342,503

  	
   

  	
  $

  	
  16,173,400

  	
   

  	
  $

  	
  16,820,336

  	
   

  
	
   

  	
  13

  	
   

  	
  Apr-06

  	
   

  	
   

  	
   

  	
  2.00

  	
  %

  	
  2.00

  	
  %

  	
  13.00

  	
  %

  	
   

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  16,173,400

  	
   

  	
  $

  	
  29,112,120

  	
   

  
	
   

  	
  14

  	
   

  	
  May-06

  	
   

  	
   

  	
   

  	
  2.00

  	
  %

  	
  2.00

  	
  %

  	
  15.00

  	
  %

  	
   

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  19,408,080

  	
   

  	
  $

  	
  32,346,800

  	
   

  
	
   

  	
  15

  	
   

  	
  Jun-06

  	
   

  	
   

  	
   

  	
  2.00

  	
  %

  	
  2.00

  	
  %

  	
  17.00

  	
  %

  	
   

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  19,408,080

  	
   

  	
  $

  	
  32,346,800

  	
   

  
	
   

  	
  16

  	
   

  	
  Jul-06

  	
   

  	
   

  	
   

  	
  2.00

  	
  %

  	
  2.00

  	
  %

  	
  19.00

  	
  %

  	
   

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  16,173,400

  	
   

  	
  $

  	
  29,112,120

  	
   

  
	
   

  	
  17

  	
   

  	
  Aug-06

  	
   

  	
   

  	
   

  	
  2.00

  	
  %

  	
  2.00

  	
  %

  	
  21.00

  	
  %

  	
   

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  19,408,080

  	
   

  
	
   

  	
  18

  	
   

  	
  Sep-06

  	
   

  	
   

  	
   

  	
  2.00

  	
  %

  	
  2.00

  	
  %

  	
  23.00

  	
  %

  	
   

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  25,877,440

  	
   

  
	
   

  	
  19

  	
   

  	
  Oct-06

  	
   

  	
   

  	
   

  	
  1.00

  	
  %

  	
  1.00

  	
  %

  	
  24.00

  	
  %

  	
   

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  9,704,040

  	
   

  	
  $

  	
  16,173,400

  	
   

  
	
   

  	
  20

  	
   

  	
  Nov-06

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  24.50

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  16,173,400

  	
   

  
	
   

  	
  21

  	
   

  	
  Dec-06

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  25.00

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  16,173,400

  	
   

  
	
   

  	
  22

  	
   

  	
  Jan-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  25.50

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  9,704,040

  	
   

  
	
   

  	
  23

  	
   

  	
  Feb-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  26.00

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  16,173,400

  	
   

  	
  $

  	
  19,408,080

  	
   

  
	
   

  	
  24

  	
   

  	
  Mar-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  26.50

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  9,704,040

  	
   

  	
  $

  	
  12,938,720

  	
   

  
	
   

  	
  25

  	
   

  	
  Apr-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  27.00

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  12,938,720

  	
   

  	
  $

  	
  16,173,400

  	
   

  
	
   

  	
  26

  	
   

  	
  May-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  27.50

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  9,704,040

  	
   

  
	
   

  	
  27

  	
   

  	
  Jun-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  28.00

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  9,704,040

  	
   

  	
  $

  	
  12,938,720

  	
   

  
	
   

  	
  28

  	
   

  	
  Jul-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  28.50

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  9,704,040

  	
   

  	
  $

  	
  12,938,720

  	
   

  
	
   

  	
  29

  	
   

  	
  Aug-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  29.00

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  4,733,360

  	
   

  	
  $

  	
  7,968,040

  	
   

  
	
   

  	
  30

  	
   

  	
  Sep-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  29.50

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  2,234,680

  	
   

  	
  $

  	
  5,469,360

  	
   

  
	
   

  	
  31

  	
   

  	
  Oct-07

  	
   

  	
   

  	
   

  	
  0.50

  	
  %

  	
  0.50

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  4,469,360

  	
   

  	
  $

  	
  7,704,040

  	
   

  
	
   

  	
  32

  	
   

  	
  Nov-07

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  2,234,680

  	
   

  	
  $

  	
  2,234,680

  	
   

  
	
   

  	
  33

  	
   

  	
  Dec-07

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  2,234,680

  	
   

  	
  $

  	
  2,234,680

  	
   

  
	
   

  	
  34

  	
   

  	
  Jan-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  8,704,040

  	
   

  	
  $

  	
  8,704,040

  	
   

  
	
   

  	
  35

  	
   

  	
  Feb-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  3,234,680

  	
   

  
	
   

  	
  36

  	
   

  	
  Mar-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  6,469,360

  	
   

  
	
   

  	
  37

  	
   

  	
  Apr-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  6,469,360

  	
   

  
	
   

  	
  38

  	
   

  	
  May-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  6,469,360

  	
   

  	
  $

  	
  6,469,360

  	
   

  
	
   

  	
  39

  	
   

  	
  Jun-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  3,234,680

  	
   

  
	
   

  	
  40

  	
   

  	
  Jul-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  3,234,680

  	
   

  
	
   

  	
  41

  	
   

  	
  Aug-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  3,234,680

  	
   

  
	
   

  	
  42

  	
   

  	
  Sep-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  3,234,680

  	
   

  	
  $

  	
  3,234,680

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.00%

  	
   

  	
  30.00

  	
  %

  	
  30.00

  	
  %

  	
   

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  194,102,365

  	
   

  	
  $

  	
  452,855,200

  	
   

  	
  $

  	
  646,957,565

  	
   

  

 

 

ATTACHMENT
D

 

FORM OF CHANGE ORDER

 

D-1

 

SCHEDULE
D-1

 

CHANGE ORDER FORM

(for use when the Parties mutually agree upon
and execute the Change Order pursuant to Section 6.1B or 6.2C)

 

	
  PROJECT NAME: Sabine Pass LNG Receiving,
  Storage and Regasification Terminal

  	
  CHANGE ORDER NUMBER:

  
	
   

  	
  DATE OF CHANGE ORDER:

  
	
  OWNER: Sabine Pass LNG, L.P.

  	
   

  
	
   

  	
   

  
	
  CONTRACTOR: Bechtel Corporation

  	
   

  
	
   

  	
   

  
	
  DATE OF AGREEMENT: December 18, 2004

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  The Agreement between the Parties listed above is changed as
  follows:  (attach additional documentation if necessary)

  
	
   

  	
   

  
	
   

  	
   

  
	
  Adjustment to Contract Price

  	
   

  
	
   

  	
   

  
	
  The original Contract
  Price was

  	
   

  	
  $

  	
   

  
	
  Net change by previously
  authorized Change Orders (#                         )

  	
   

  	
  $

  	
   

  
	
  The Contract Price prior to this Change Order was

  	
   

  	
  $

  	
   

  
	
  The Contract Price will be (increased) (decreased) (unchanged) by
  this Change Order in the amount of

  	
   

  	
  $

  	
   

  
	
  The new Contract Price
  including this Change Order will be

  	
   

  	
  $

  	
   

  
					

 

Adjustment to dates in Project
Schedule

The following dates are
modified (list all dates modified; insert N/A if no dates
modified):

 

The Target Bonus Date will be (increased)(decreased)(unchanged) by                    
(     ) Days.

 

The Target Bonus Date as of the date of this Change Order therefore is                         ,
20     .

(attach additional documentation if necessary)

 

The Guaranteed Substantial Completion Date will be
(increased)(decreased)(unchanged) by                  
(      ) Days.

 

The Guaranteed Substantial Completion Date as of the date of this
Change Order therefore is                       ,
20     .

(attach additional documentation if necessary)

 

Adjustment to other Changed Criteria (insert N/A
if no changes or impact; attach additional documentation if necessary)

 

Adjustment to Payment Schedule:

 

Adjustment to Minimum Acceptance Criteria:

 

Adjustment to Performance Guarantees:

 

Adjustment to Design Basis:

 

Other adjustments to liability or obligation of Contractor or Owner
under the Agreement:

 

This Change Order [shall] [shall not] constitute
a full and final settlement and accord and satisfaction of all effects of the
change as described in this Change Order upon the Changed Criteria and shall be
deemed to compensate Contractor fully for such change.

 

D-2

 

Upon execution of this Change Order by Owner and Contractor, the
above-referenced change shall become a valid and binding part of the original
Agreement without exception or qualification, unless noted in this Change
Order.  Except as modified by this and
any previously issued Change Orders, all other terms and conditions of the
Agreement shall remain in full force and effect.  This Change Order is executed by each of the
Parties’ duly authorized representatives.

 

 

	
   

  	
   

  	
   

  	
   

  
	
  Owner

  	
   

  	
  Contractor

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name

  	
   

  	
  Name

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date of Signing

  	
   

  	
  Date of Signing

  	
   

  

 

D-3

 

SCHEDULE
D-2

 

UNILATERAL CHANGE ORDER FORM

(for use when only Owner executes the Change
Order pursuant to Section 6.1C or 6.2D)

 

	
  PROJECT NAME: Sabine Pass LNG Receiving,
  Storage and Regasification Terminal

  	
  CHANGE ORDER NUMBER:

  
	
   

  	
  DATE OF CHANGE ORDER:

  
	
  OWNER: Sabine Pass LNG, L.P.

  	
   

  
	
   

  	
   

  
	
  CONTRACTOR: Bechtel Corporation

  	
   

  
	
   

  	
   

  
	
  DATE OF AGREEMENT: December 18, 2004

  	
   

  

 

 

You are hereby directed to make the following additions or
modifications to, or deductions from, the Work (attach additional documentation if necessary)

 

 

 

Compensation
for the changes specified in this Change Order is on a time and materials basis
as provided in Section 6.1C and 6.2D of the Agreement.

 

Contractor shall commence with the performance of the change(s)
described above [insert date].

 

This Change Order is signed by Owner’s duly authorized representative.

 

 

	
   

  	
   

  	
   

  
	
  Owner

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date of Signing

  	
   

  	
   

  

 

D-4

 

SCHEDULE D-3

 

CONTRACTOR’S CHANGE ORDER REQUEST FORM/

CONTRACTOR’S RESPONSE TO A CHANGE ORDER PROPOSED BY OWNER

(For use by Contractor (i) 
pursuant to Section 6.2B of the Agreement, when
Contractor requests a proposed Change Order, and (ii) pursuant to Section 6.1A
of the Agreement, in responding to a Change Order proposed by Owner)

 

	
  PROJECT
  NAME: Sabine Pass LNG Receiving, Storage and Regasification Terminal

  	
  CHANGE
  ORDER REQUEST NUMBER:

  
	
   

  	
  DATE
  OF CHANGE ORDER REQUEST:

  
	
  OWNER:
  Sabine Pass LNG,
  L.P.

  	
   

  
	
   

  	
   

  
	
  CONTRACTOR: Bechtel Corporation

  	
   

  
	
   

  	
   

  
	
  DATE
  OF AGREEMENT: December 18, 2004

  	
   

  

 

 

Contractor proposes the following change(s) in the Agreement:  (attach additional documentation, if necessary)

 

OR (as applicable)

 

Owner proposes the following change(s) in the Agreement: 
attach additional documentation, if necessary)

 

 

Detailed Reasons for Proposed Change(s) (provide detailed reasons for the
proposed change, and attach all supporting documentation required under the
Agreement)

 

 

Proposed Adjustments to Agreement (attach additional documentation,
if necessary)

 

Contract
Price Adjustment:

 

Target
Bonus Date Adjustment:

 

Guaranteed
Substantial Completion Date Adjustment:

 

Adjustment
to Payment Schedule:

 

Adjustment
to Minimum Acceptance Criteria:

 

Adjustment
to Performance Guarantees:

 

Adjustment
to Guarantee Conditions:

 

Adjustment
to Design Basis:

 

Other
adjustments to liability or obligations of Contractor under the Agreement:

 

This
request for Change Order is signed by Contractor’s duly authorized
representative.

 

 

	
   

  	
   

  	
   

  
	
  Contractor

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date
  of Signing

  	
   

  	
   

  

 

D-5

 

SCHEDULE
D-4

 

UNIT RATES FOR CHANGE ORDERS

PERFORMED ON A TIME AND MATERIALS BASIS

 

	
   

  	
   

  	
   

  	
   

  	
  Unit

  	
   

  	
  Rate (in US$)

  	
   

  	
   

  	
   

  
	
  Item

  	
   

  	
  Cost Category

  	
   

  	
  Year

  	
   

  	
  2004

  	
   

  	
  2005

  	
   

  	
  2006

  	
   

  	
  2007

  	
   

  	
  2008

  	
   

  	
  Remarks

  	
   

  
	
  1

  	
   

  	
  Home Office

  	
   

  	
  Home Office
  Man-Hour

  	
   

  	
  $

  	
  123

  	
   

  	
  $

  	
  128

  	
   

  	
  $

  	
  134

  	
   

  	
  $

  	
  140

  	
   

  	
  $

  	
  146

  	
   

  	
  Includes all
  home office labor and other direct costs except travel.

  	
   

  
	
  2

  	
   

  	
  Field
  Non-Manual

  	
   

  	
  Field
  Non-Manual Man-Hour

  	
   

  	
   

  	
   

  	
  $

  	
  104

  	
   

  	
  $

  	
  106

  	
   

  	
  $

  	
  109

  	
   

  	
  $

  	
  118

  	
   

  	
  Includes all
  field non-manual labor, other direct costs including relocation and temporary
  assignments, except business travel.

  	
   

  
	
  3

  	
   

  	
  Construction
  Direct and Indirect Labor

  	
   

  	
  Direct
  Construction Labor Man-Hour

  	
   

  	
   

  	
   

  	
  $

  	
  29

  	
   

  	
  $

  	
  32

  	
   

  	
  $

  	
  35

  	
   

  	
  $

  	
  35

  	
   

  	
  Includes all
  construction direct labor and indirect labor, temporary facilities, material
  and small tools and consumables. Does not include large tools, Construction
  Equipment, or manual travel.

  	
   

  
	
  4

  	
   

  	
  Direct
  Material and Subcontracts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Cost plus
  10% markup on material and 5% markup on Subcontracts

  	
   

  
	
  5

  	
   

  	
  Construction
  Equipment and tools valued over $1,500

  	
   

  	
  Each

  	
   

  	
  Actual
  invoiced rental rates + 10% Markup 

  	
   

  	
  For
  additional Construction Equipment or large tools not in the base plan.

  	
   

  
	
  6

  	
   

  	
  Business
  Travel

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Based on
  Contractor’s travel policies attached as Exhibit 1.

  	
   

  
																							

 

This Schedule D-4 (including
the attached Exhibit 1) shall be used: (i) by Contractor to develop its
proposed adjustment to the Contract Price for a proposed Change Order submitted
by Owner in accordance with Section 6.1A of the Agreement; (ii) by the Parties
to determine the amount of compensation that Contractor is entitled to with
respect to an unilateral Change Order executed by Owner in accordance with
Section 6.1C or Section 6.2D of the Agreement; or (iii) by Contractor to
develop its proposed adjustment to the Contract Price for any request for a
proposed Change Order made by Contractor in accordance with Section 6.2B or
Section 6.5B of the Agreement.

 

The above listed labor rates
are all inclusive and include, among other things, wages and salaries paid to
employees, holidays, vacation, sick leave, hospitalization and medical
insurance, life insurance, payroll taxes, retirement and incentive programs,
computer hardware and software, local communications, reproduction, overhead
and profit.

 

If a Change Order results in
Contractor incurring travel expenses necessary to the performance of the
changed Work, and such travel expenses are reimbursable under an unilateral
Change Order, Contractor shall be compensated based on the actual cost for such
travel expenses, provided that such expenses comply with the requirements of Exhibit
1.

 

D-6

 

If additional temporary
facilities such as buildings, roads, parking areas, lay down areas, fence and
services such as watch persons and guards have to be added to execute the
Change Order, the costs will be extra.

 

D-7

 

Exhibit 1

 

Contractor’s Travel Policy

 

A.                                   GENERAL

 

Employees are on business trips
when they are directed to travel for business purposes and their stay at any
one location is not expected to exceed 60 Days.

 

Organization Manager approval
is required to assign an employee initially on a business trip for more than 60
Days or to extend a business trip beyond 60 Days.

 

Transportation and actual
reasonable expenses incurred by employees on business trips will be
reimbursed.  Allowances are detailed
below.

 

Accompanied status is not
normally authorized for employees on business trips.  Special circumstances where spouses or
domestic partners may accompany employees are detailed in Corporate Manual
Policy 106, Business Travel.

 

B.                                     TRANSPORTATION

 

1.                                       Public
Carrier

 

Employees on business trips are
reimbursed for the most economical class of regularly scheduled, reserved seat
service available plus actual and reasonable expenses to and from the airport.

 

Guidelines
for class of service:

 

	
  Domestic
  travel (all countries)

  	
   

  	
  Economy/Coach

  	
   

  
	
  International
  travel under 7 hours

  	
   

  	
  Economy/Coach

  	
   

  
	
  International
  travel greater than 7 hours

  	
   

  	
  Business

  	
   

  
	
  International
  travel overnight with next Day business

  	
   

  	
  Business

  	
   

  

 

2.                                       Private
Automobile

 

Mileage costs via the most
direct route will be reimbursed at the allowable rates set by the Internal Revenue
Service per mile.  Tolls are reimbursed
in addition to the mileage rate.

 

C.                                     FOOD,
LODGING AND MISCELLANEOUS EXPENSES

 

Actual reasonable expense
incurred during travel will be reimbursed.

 

D-8

 

ATTACHMENT
E

 

PROJECT SCHEDULE

 

	
  Limited
  Notice to Proceed:

  	
   

  	
  No later
  than January 4, 2005

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Notice to
  Proceed:

  	
   

  	
  The later of
  (A) ninety (90) Days following Owner’s issuance of the Limited Notice to
  Proceed or (B) April 4, 2005

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Target Bonus
  Date:

  	
   

  	
  One Thousand
  Ninety Five (1095) Days following Owner’s issuance of the Notice to Proceed

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Guaranteed
  Substantial Completion Date:

  	
   

  	
  One Thousand
  Two Hundred Forty-Seven (1247) Days following Owner’s issuance of the Notice
  to Proceed

  	
   

  

 

E-1

 

ATTACHMENT F

 

KEY PERSONNEL AND CONTRACTOR’S
ORGANIZATION

 

The following individuals are Key Personnel.  Key Personnel shall, unless agreed by Owner,
be devoted full time to the Work for the minimum duration specified.  A scheduled destaffing plan shall be developed
by Contractor during LNTP.

 

	
  Position

  	
   

  	
  Nominee

  	
   

  	
  Mobilization

  	
   

  	
  Demobilization(1)

  	
   

  
	
  Project
  Director

  	
   

  	
  Asok
  Kumar

  	
   

  	
  LNTP

  	
   

  	
  Full-time
  through Substantial Completion; part-time thereafter as necessary for the
  Work

  	
   

  
	
  Project
  Manager/Major Subcontracts

  	
   

  	
  TBA(2)

  	
   

  	
  LNTP

  	
   

  	
  Full-time
  through Final Completion

  	
   

  
	
  Project
  Engineering Manager

  	
   

  	
  Sho Ota

  	
   

  	
  LNTP

  	
   

  	
  Full-time
  through end of engineering; part-time thereafter as necessary for the Work

  	
   

  
	
  Procurement
  Manager

  	
   

  	
  TBA(2)

  	
   

  	
  LNTP

  	
   

  	
  Full
  time through purchase of all Major Equipment; part time thereafter as
  necessary for the Work

  	
   

  
	
  Site
  Manager

  	
   

  	
  Bruce
  Sullivan

  	
   

  	
  LNTP

  	
   

  	
  Full-time
  through Substantial Completion; part-time thereafter as necessary for the
  Work

  	
   

  
	
  Project
  Controls Manager

  	
   

  	
  TBA(2)

  	
   

  	
  LNTP

  	
   

  	
  Full-time
  through Substantial Completion; part-time thereafter as necessary for the
  Work

  	
   

  
	
  QA
  Manager

  	
   

  	
  TBA(2)

  	
   

  	
  NTP

  	
   

  	
  Full
  time through Ready for Cool Down, part-time thereafter as necessary for the
  Work

  	
   

  
	
  HSE
  Manager

  	
   

  	
  TBA(2)

  	
   

  	
  NTP

  	
   

  	
  Full
  time through Substantial Completion, part-time thereafter as necessary for
  the Work

  	
   

  

 

(1) The stated durations are
an estimate only and such Key Persons shall be dedicated full time to the Work
for a longer period, if necessary, for such Key Person to perform his or her
tasks.

 

(2) Within thirty (30) Days
after LNTP, Contractor shall propose for Owner’s approval (such approval not to
be unreasonably withheld) a person for the positions listed as “TBA.”  Such proposals shall include the resumes of
professional education and experience for such person.

 

 

Cheniere
LNG Terminal Project
Organization Chart

Sabine Pass

 

 

* Key Personnel

 

 

 

ATTACHMENT G

 

APPROVED SUBCONTRACTORS AND
SUB-SUBCONTRACTORS

AND LIST OF MAJOR EQUIPMENT

1.1                               Introduction

 

Subject to the provisions of
Section 2.4 of the Agreement, this Attachment includes (in Section 1.6) the
List of Approved Subcontractors; identifies (in Section 1.3) the Subcontracts
designated as Major Subcontracts, identifies (in Section 1.4) the
Sub-subcontracts which are designated as Major Sub-subcontracts, and lists (in
Section 1.5) the Equipment designated as Major Equipment.

 

1.2                               Local
Content

 

Contractor shall give due
consideration to local companies to provide materials and services, provided
they are competitive in terms and price, proven quality, experience, expertise,
service and delivery.  (Refer to Section
5.3, Schedule A-1)

 

1.3                               Major
Subcontracts

 

The following Subcontracts are
designated as Major Subcontracts (as defined in the Agreement), the
Subcontractors for which shall be deemed to be Major Subcontractors, and will
apply even if the actual contractual arrangement is as a Sub-subcontractor:

 

•                  LNG
storage Tanks

•                  Marine
facilities

•                  Soils
improvement

•                  Site
preparation

•                  Buildings

•                  Insulation

•                  Non-
destructive testing

•                  Submerged
combustion vaporizers (SCVs)

•                  Distributed
control system (DCS)

•                  Safety
integrity systems (SIS)

•                  Recondensers

•                  Boil-off
Gas Compressors

•                  Boil-off
Gas blowers

 

G-1

 

•                  LNG
pumps

•                  Power
generation packages

•                  Instrument
air compressors

•                  Cryogenic
valves

•                  Custody
transfer metering systems

•                  Marine
unloading arms

•                  All
other Subcontracts having an aggregate value of five million dollars
($5,000,000) or greater.

 

1.4                               Major
Sub-Subcontracts

 

The following Sub-subcontracts
are designated as Major Sub-subcontracts (as defined in the Agreement), the
Sub-subcontractors for which shall be deemed to be Major Sub-subcontractors:

 

•                  Insulation
Sub-subcontract for the LNG Tanks

•                  Supplier
of 9% Nickel plate for LNG Tanks

•                  Dredging

 

1.5                               Major
Equipment

 

The following Equipment items
shall be deemed to be Major Equipment (as defined in the Agreement):

 

•                  Submerged
combustion vaporizers (SCVs)

•                  Distributed
control system (DCS)

•                  Safety
integrity systems (SIS)

•                  Recondensers

•                  Boil-off
gas compressors

•                  Boil-off
as blowers

•                  LNG
pumps

•                  Power
generation packages

•                  Instrument
air compressors

•                  Cryogenic
valves

•                  Custody
transfer metering systems

•                  Marine
unloading arms

•                  All
other equipment having a per-item cost of one million dollars ($1,000,000) or
greater.

 

G-2

 

1.6                               List
of Approved Subcontractors

 

Contractor shall use those
Subcontractors listed below for the specified items of Work.  Any deviation from this list or requests to
use other Subcontractors for material or Equipment purchases must be approved
in writing in advance by Owner.

 

Chromatographs

ABB Analytics (Bendix) - USA

Applied Automation – USA

Daniel – USA

Yokagawa – Japan

Emerson (Rosemont) - USA

 

Compressors,
Plant and Instrument Air

Ingersoll-Rand - USA

Joy-Cooper - USA

Atlas Copco - USA

Kobe Steel – Japan

Elliott – USA

GHH Borsig - Germany

Gardner Denver - USA

Demag DeLaval – USA

IHI - Japan

Kobelco – Japan

Airdyne - USA

 

Compressors,
Boil Off Gas

Sulzer Burkhardt – USA/Switzerland

Japan Steel Works – Japan

IHI – Japan

Ebara - USA

Neuman and Esser – Germany

Demag Delaval – Germany/USA

Elliott Company – USA

Dresser-Rand – USA

Nuovo Pignone – Italy

 

Compressors,
High Pressure Sendout (Not currently in scope)

Sulzer Burkhardt –
USA/Switzerland

Japan Steel Works – Japan

IHI – Japan

Ebara - USA

 

G-3

 

Neuman and Esser – Germany

Demag Delaval – Germany/USA

Elliott Company – USA

Dresser-Rand – USA

Nuovo Pignone – Italy

 

Custody
Transfer Metering System 

Daniel Industries – USA

Instromet, Inc. – USA

Brazos Valley Sysems, Inc. –
USA

Sagebrush - USA

FMC Measurement Solutions - USA

Alderley Ltd – UK

En-Fab, Inc. – USA

Moorco/Smith – USA

Linco/Electromatic - USA

Lightning Fabricators – USA

WES Operations - USA

 

Distributed
Control Systems (DCS)

Invensys – USA

Emerson – USA

Yokogawa – USA

Honeywell – USA

ABB - USA

 

Electric
Motors (NEMA Frame)

General Electric - USA

U.S. Electric - USA

Reliance – USA/Mexico

Westinghouse - USA

Siemens – USA/Mexico

Industrias IEM (BF) - Mexico

Unimega S.A. DE C. V. – Mexico

Continental – USA

Toshiba – USA

ABB - International

 

Expansion
Joints - Piping

Munro & Miller – UK

Tokyo Rasenkan Seisakusho –
Japan

Pathway Bellows – USA

Senior Flexonics – USA

Badger Industries – USA

 

G-4

 

U.S. Bellows – USA

American BOA – USA

Expansion Joint Systems - USA

 

Flame
Arrestors

Groth - USA

Shand & Jurs - USA

Protectoseal - USA

Varec/Westech - USA

Zink - USA

GPE Controls – USA

Tornado – USA

 

Generators,
Combustion Turbine

Solar Turbines - USA

General Electric (Nuovo
Pignone) - International

Pratt & Whitney (Man
Turbomachinery- Sulzer) – International

Rolls Royce Energy Systems –
International

Siemens Demag DeLaval
Industrial Turbomachinery (Alstom) – International

 

LNG Tanks

 

Matrix/MHI – USA/Japan

CB&I – USA

Technigaz – France

TKK – Japan

IHI – Japan

 

LNG Pumps

Cryostar - USA

Ebara International - USA

Sulzer Bingham - USA

David Brown/Union Pumps - USA

J.C. Carter – USA

Nikkiso – Japan

Flowserve (BW/IP) - USA

 

LNG Vapor
Blowers

Tuthill Corporation – USA

Dresser Industries, Inc. – USA

General Electric – USA

Mafi – Trench - USA

 

G-5

 

Marine
Facilities

Weeks Marine - USA

Bo-Mac - USA

American Bridge/Great Lakes Dredge
Joint Venture - USA

 

Monitors,
Displacement, Vibration, Speed (Machine Protection Systems)

Bently Nevada - International

Brüel & Kjaer -
International

Vibrometer - International

CML - International

SKF - International

 

Motor
Control Centers/Switchgear

Powell Electrical Manufacturing
Company - USA

General Electric - USA

Siemens – USA/Mexico

Allen Bradley (MCCs only) - USA

Electrical Power Systems - USA

Square “D” Company - USA

Merlin Gerin - France

Holec – Netherlands

Fuji Electric - Japan

Toshiba - Japan

S & L - UK

GEC Alstrom - UK

ABB- Germany

Cutler Hammer (Eaton) – USA

Cutler Hammer Mexicana – Mexico

Schneider Electric Mexico –
Mexico

ABB Equipos Y Sistemas - Mexico

 

Motor
Operated Valve Assemblers and Manufacturers of Valves

AVSI - USA

Baro Controls - USA

Valve Systems & Controls -
USA

Tyco/Keystone - USA

Puffer Sweiven - USA

R. J. Gallagher - USA

Raimondi - USA

McJunkin – USA

Sunbelt Supply – USA

Velan – Canada/USA

Bernard Controls – USA

 

G-6

 

EIM – USA

Envalco – USA

MOV Controls - USA

 

Overhead
Cranes – Air Powered

PCT – UK

Yale - USA

Ingersoll-Rand Material Handling - USA

Chester Hoist Inc. - USA

Detroit Hoist & Crane Co. - USA

American Crane & Hoist Corp. - USA

Coffing Hoists - USA

Columbus McKinnon Corp. - USA

 

Relief
Valves - Conventional

Dresser Industrial Valve &
Instruments Division (Consolidated) - USA

Anderson-Greenwood /Crosby -
USA

Farris  USA

Groth - USA

 

Relief
Valves - Pilot Operated

Anderson Greenwood/ Crosby –
USA

Dresser Industrial Valve &
Instruments Division (Consolidated) - USA

 

Process
Gas Chromatograph

Elsag Bailey - International

Hartman & Braun -
International

Applied Automation –
International

ABB Process Analytics - International

Foxboro - International

Kinetic VP - International

Rotork - International

Precision Scientific –
International

Daniel – USA

Yokagawa – Japan

Emerson (Rosemont) – USA

 

G-7

 

Site
Preparation

Cajun Constructors – USA

James Brothers – USA

Crain Brothers - USA

 

Soils
Improvement

Recon – USA (preferred
Subcontractor.  The following are
approved only if Contractor cannot come to agreement with the preferred
Subcontractor: Raito – USA, Hayward Baker – USA, and DGI-Menard – USA.)

 

Ultrasonic
Flow meter

Controlotron - International

Panametrics - International

Krone Altometer – International

Instromet – US

Daniel – International

ABB – International

Control Engineering - USA

 

Natural
Gas Pipeline Ball Valve

Grove – USA

Cameron - USA

KF -Italy

Perrar – Italy

Petrolvalve -Italy

PBV -USA

 

Nitrogen
Storage and Vaporization Package 

BOC – USA

Air Products – USA

Air Liquide – USA

Lotepro – USA

Praxair - USA

 

Cryogenic
and Severe Service Valves

Valtek - USA

Masoneilian - USA

Fisher - USA

CCI  USA

Severn Glocon - UK

 

Submerged
Combustion Vaporizers

T-Thermal – USA

Kaldair-UK

 

G-8

 

Sumitomo Corporation of America
–USA/Japan

 

Tank
Gauges (LNG Tanks)

Varec - International

Enraf - International

Radar Gauge (Saab) -
International

Whessoe- International

Emerson (Rosemont) -
International

Foxboro - International

 

Unloading
Arms

FMC – France

SVT Connex – Germany

Emco Weaton – USA

Woodfield - UK

 

Valves,
Cryogenic Ball

Kitamura Valve Mfg. Co – Japan

Truflo Valves – U.K.

Kitz Corp - Japan

Bray - USA

Centerline - USA

Crane - USA

Durco - USA

Flowseal - USA

Jamesbury - USA

Pratt - USA

Norris - USA

PosiSeal - USA

Tufline - USA

WKM - USA

Keystone - USA

McCanna - USA

Grinnel - USA

Clow (Tri-Centric) - USA

Vanessa (Keystone) - Italy

AMRI -  USA

Adams - Germany

Tomoe - Japan

Duvalco - Netherlands

Xomox - Japan

Neles - Japan

Westad - Norway

Water Witzel – Netherlands

 

G-9

 

OMS Salari – Italy

Velan -  USA

Perar – Italy

Poyam – Spain

TBV - USA

Petrolrtorvalve - Italy

Tong Yung –Korea

OMB – Italy

Hindle- Great Britain

Orbit - USA

 

Valves,
Cryogenic Butterfly

Neles Inc. – USA

Royal – USA

Amri Inc. – USA

Velan – USA

Vanessa (Tyco) – USA

Adams – Germany

Orton – Italy

Linde MPAG- Germany

 

Valves,
Cryogenic Globe &  Check Valves

Velan – Canada/USA

Tong Yung – Korea

OMB- Italy

 

Valves,
Non-Return

Vanessa - USA

Rockwell - USA

Newco - USA

Shoritsu - Japan

Fasani - Italy

Kitz – Japan

 

Vent  System

John Zink - USA

Kaldair - USA

Flaregas - USA

Callidus – USA

Tornado – USA

MRW Technologies - USA

 

G-10

 

ATTACHMENT
H

 

FORM OF LIMITED NOTICE TO PROCEED

AND NOTICE TO PROCEED

 

H-1

 

SCHEDULE H-1

 

FORM OF LIMITED NOTICE TO PROCEED

 

	
   

  	
  Date:

  	
   

  

 

Via
Facsimile (713) 235-1610 and Overnight Courier

Bechtel
Corporation

3000
Post Oak Boulevard

Houston,
Texas 77056

Attention:  Mr. C. Asok Kumar

 

Re:                               Limited Notice to Proceed

 

Pursuant
to Section 5.2A of the Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Sabine Pass LNG Receiving, Storage and
Regasification Terminal, dated as of December 18, 2004 (the “Agreement”), by
and between Sabine Pass LNG, L.P. (“Owner”) and Bechtel Corporation
(“Contractor”), this letter shall serve as the Limited Notice to Proceed from
Owner to Contractor authorizing Contractor to proceed with the LNTP Work
described in Section 11 of Attachment A pursuant to the terms and conditions
of the Agreement.

 

 

	
   

  	
  For
  and on behalf of

  
	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine
  Pass LNG-LP, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
    By:

  	
   

  	
   

  
	
   

  	
   

  	
    Name:

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  	
   

  	
   

  
								

 

By
its signature hereto, the undersigned hereby acknowledges and accepts this
Limited Notice to Proceed.

 

For
and on behalf of

BECHTEL
CORPORATION

 

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

cc:                                 Bechtel Corporation

3000
Post Oak Boulevard

Houston,
Texas 77056

Facsimile:
(713) 235-3945

Attn:
Principal Counsel

 

H-2

 

SCHEDULE
H-2

 

FORM OF NOTICE TO PROCEED

 

	
   

  	
  Date:

  	
   

  

 

Via
Facsimile (713) 235-1610 and Overnight Courier

Bechtel
Corporation

3000
Post Oak Boulevard

Houston,
Texas 77056

Attention:  Mr. C. Asok Kumar

 

Re:                               Notice to Proceed

 

Pursuant
to Section 5.2B of the Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Sabine Pass LNG Receiving, Storage and
Regasification Terminal, dated as of December 18, 2004 (the “Agreement”), by
and between Sabine Pass LNG, L.P. (“Owner”) and Bechtel Corporation
(“Contractor”), this letter shall serve as the Notice to Proceed from Owner to
Contractor authorizing Contractor to proceed with the Work pursuant to the
terms and conditions of the Agreement.

 

 

	
   

  	
  For
  and on behalf of

  
	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine
  Pass LNG-LP, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
							

 

By
its signature hereto, the undersigned hereby acknowledges and accepts this
Notice to Proceed.

 

	
  For
  and on behalf of

  	
   

  
	
  BECHTEL
  CORPORATION

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  cc:

  	
  Bechtel
  Corporation

  	
   

  
	
   

  	
  3000
  Post Oak Boulevard

  	
   

  
	
   

  	
  Houston,
  Texas 77056

  	
   

  
	
   

  	
  Facsimile:
  (713) 235-3945

  	
   

  
	
   

  	
  Attn:
  Principal Counsel

  	
   

  
						

 

H-3

 

ATTACHMENT I

 

FORM OF
CONTRACTOR’S INVOICES

 

I-1

 

SCHEDULE I-1

 

FORM OF
CONTRACTOR’S INTERIM INVOICE

 

	
  PROJECT NAME:
  Sabine Pass LNG Receiving, Storage and Regasification Terminal

  	
  INVOICE NUMBER:

  
	
   

  	
  DATE OF INVOICE:                                   ,
  200   

  
	
  OWNER: Sabine
  Pass LNG, L.P.

  	
   

  
	
   

  	
   

  
	
  CONTRACTOR:
  Bechtel Corporation

  	
   

  
	
   

  	
   

  
	
  DATE OF AGREEMENT:  December
  18, 2004

  	
   

  

 

 

This
Invoice covers Milestone No(s).                  
(Attachment C, Schedule C-1 of the Agreement) and Monthly Payment
No.                      
(Attachment C, Schedule C-2) and covers the period from                             ,
200    to                                ,
200     (“Current Date”).

 

Contractor
hereby makes application for payment to Owner as shown below in connection with
the above referenced Contract between the Parties.

 

	
  1.

  	
   

  	
  Original Contract Price
  (Section 7.1 of Agreement)

  	
   

  	
  U.S.$

  	
   

  
	
  2.

  	
   

  	
  Net change by Change
  Orders (except unilateral Change Orders) (Exhibit 2)

  	
   

  	
  U.S.$

  	
   

  
	
  3.

  	
   

  	
  Contract Price to date
  (Line 1 + Line 2)

  	
   

  	
  U.S.$

  	
   

  
	
  4.

  	
   

  	
  Total earned to date
  for completion of Milestones (Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  5.

  	
   

  	
  Total earned to date on
  Monthly Payments (Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  6.

  	
   

  	
  Total earned to date on
  unilateral Change Orders (Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  7.

  	
   

  	
  Total earned to date

  (Line 4 + Line 5 + Line 6)

  	
   

  	
  U.S.$

  	
   

  
	
  8

  	
   

  	
  Less previous Invoices
  (Line 7 from prior Invoice)

  	
   

  	
  U.S.$

  	
   

  
	
  9.

  	
   

  	
  Current Payment Due (Line
  7 less Line 8)

  	
   

  	
  U.S.$

  	
   

  
	
  10.

  	
   

  	
  Balance of Contract
  Price remaining (Line 3 less Lines 4 and 5)

  	
   

  	
  U.S.$

  	
   

  

 

Contractor certifies that
(i) the Work is progressing in accordance with the Project Schedule (as may be
adjusted by Change Order) and CPM Schedule, as set forth in the current Monthly
Progress Report (ii) the Work described in or relating to this Invoice has been
performed and supplied in accordance with the Agreement, (iii) all quantities
and prices in this Invoice or attached Schedules are correct and in accordance
with the Agreement and the referenced Milestone(s) is/are complete, (iv) Contractor
is entitled to payment of the amount set forth as “Current
Payment Due” in this Invoice (v) to the extent Contractor has
been invoiced by any Major Subcontractor and the due date for payment by
Contractor to such Major Subcontractor has occurred on or before the date of
this Invoice, attached to this Invoice are fully completed and executed Interim
Conditional Lien Waivers from each such Major Subcontractor and Major
Sub-subcontractor for all Work performed by such Major Subcontractor and Major
Sub-subcontractor, respectively, and (vi) this Invoice is signed by an
authorized representative of Contractor.

 

Payment is to be
made by wire transfer or ACH on or before [insert due date]
to:

The Bank of New York

New York, NY

Account # 8900512288

Acct. Type: Checking
(DDA) ACH Format: CTX

ABA # 021 000 018

Credit: Bechtel
Corporation

 

	
  CONTRACTOR

  	
   

  
	
  Signed:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
  , 200

  	
   

  	
   

  
							

 

I-2

 

SABINE PASS LNG RECEIVING,
STORAGE AND REGASIFICATION TERMINAL

 

	
  INVOICE NUMBER 

  	
  INVOICE DATE                            ,
  200       

  

 

OWNER APPROVAL

 

AMOUNT APPROVED by Owner
for Payment: U.S.$

 

	
  OWNER

  
	
  Signed: 

  	
   

  	
   

  
	
  Name: 

  	
   

  	
   

  
	
  Title: 

  	
   

  	
   

  
	
  Date:

  	
   

  	
  , 200

  	
   

  	
   

  
							

 

The AMOUNT APPROVED by
Owner is without prejudice to any rights of Owner under the Agreement.

 

Explanation is listed
below or attached if the AMOUNT APPROVED is less than the amount requested by
Contractor under this Invoice:

 

 

 

I-3

 

EXHIBIT 1

 

COMPLETION
OF MILESTONES, MONTHLY PAYMENTS

AND
UNILATERAL CHANGE ORDERS

 

MILESTONES

 

1.                                       PREVIOUS
MILESTONES COMPLETED:  The following
Milestones were completed and invoiced by Contractor in previous Invoices:

 

	
  No.

  	
   

  	
  Description of Milestone

  	
   

  	
  Original Total for Milestone

  (U.S.$)

  	
   

  	
  Total for Milestone as

  Adjusted by Change Order

  (U.S.$)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

2.                                       RECENT
MILESTONES COMPLETED:  The following
Milestones have been completed by Contractor during the period covered by this
Invoice and in accordance with the terms of the Agreement:

 

	
  No.

  	
   

  	
  Description of Milestone

  	
   

  	
  Original Total for Milestone

  (U.S.$)

  	
   

  	
  Total for Milestone as

  Adjusted by Change Order

  (U.S.$)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

MONTHLY PAYMENTS

 

3.                                       PREVIOUS
MONTHLY PAYMENTS INVOICED:  The
following Monthly Invoices were invoiced by Contractor in previous Invoices:

 

	
  No.

  	
   

  	
  Original Total for Monthly Payment

  (U.S.$)

  	
   

  	
  Total for Monthly Payment as Adjusted by Change

  Order (U.S.$)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

3.                                       CURRENT
MONTHLY PAYMENT:  The following
Monthly Payment is covered by this Invoice and in

 

I-4

 

accordance with the terms
of the Agreement:

 

	
  No.

  	
   

  	
  Original Total for Monthly Payment

  (U.S.$)

  	
   

  	
  Total for Monthly Payment as Adjusted by Change

  Order (U.S.$)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

UNILATERAL CHANGE
ORDERS

 

5.                                       WORK
COMPLETED UNDER UNILATERAL CHANGE ORDERS: 
The following Work has been completed in accordance with this Agreement
under unilateral Change Orders executed by Owner pursuant to Section 6.1C or
Section 6.2D.

 

	
  No.

  	
   

  	
  Description of Unilateral Change

  Order

  	
   

  	
  Work Completed (From

  Previous Invoices) (U.S.$)

  	
   

  	
  Work Completed (This

  Period) (U.S.$)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

I-5

 

EXHIBIT 2

 

LIST OF
EXECUTED CHANGE ORDERS

 

The following Change
Orders have been executed by Owner and Contractor pursuant to Section 6.1B or
Section 6.2C.

 

	
  No.

  	
   

  	
  Description of Change Order

  	
   

  	
  U.S.$

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

I-6

 

EXHIBIT 3

 

INTERIM CONDITIONAL
LIEN WAIVERS

 

I-7

 

EXHIBIT 4

 

INFORMATION
REQUIRED OR REQUESTED BY OWNER

 

I-8

 

SCHEDULE I-2

 

FORM OF
CONTRACTOR’S FINAL INVOICE

 

	
  PROJECT NAME:
  Sabine Pass LNG Receiving, Storage and Regasification Terminal

  	
  INVOICE NUMBER:

  
	
   

  	
  DATE OF INVOICE:                               ,
  200      

  
	
  OWNER: Sabine
  Pass LNG, L.P.

  	
   

  
	
   

  	
   

  
	
  CONTRACTOR:
  Bechtel Corporation

  	
   

  
	
   

  	
   

  
	
  DATE OF AGREEMENT: December
  18, 2004

  	
   

  

 

 

This
final Invoice covers (i) under Section 1, the period from                             ,
200      to                                    ,
200     and (ii) under Section II, any adjustments required
to reconcile all previous Invoices, payments and Change Orders.

 

I.                                         APPLICATION FOR PAYMENT. 
Contractor hereby makes application for final payment to Owner under the
Agreement, as shown below.

 

	
  1.

  	
   

  	
  Original Contract Price
  (Section 7.1 of Agreement)

  	
   

  	
  U.S.$

  	
   

  
	
  2.

  	
   

  	
  Net change by mutual
  Change Orders (Section 1 of Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  3.

  	
   

  	
  Contract Price (Line 1
  + Line 2)

  	
   

  	
  U.S.$

  	
   

  
	
  4.

  	
   

  	
  Total earned to date on
  unilateral Change Orders (Section 2 of Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  5.

  	
   

  	
  Total previously paid
  for Milestones completed (Section 3 of Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  6.

  	
   

  	
  Total previously paid
  for Monthly Payments (Section 4 of Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  7.

  	
   

  	
  Total previously paid
  for Work completed under unilateral Change Orders

  (Section 5 of Exhibit 1)

  	
   

  	
  U.S.$

  	
   

  
	
  8.

  	
   

  	
  Total paid to date
  (Line 5 + Line 6 + Line 7)

  	
   

  	
  U.S.$

  	
   

  
	
  9.

  	
   

  	
  Payment Due (Line
  3+ Line 4 - Line 8)

  	
   

  	
  U.S.$

  	
   

  

 

II.                                     ADJUSTMENTS. 
Explanation is listed below of (i) any adjustments required to reconcile
all previous Invoices, payments and Change Orders.

 

 

 

 

(Attach supporting documentation.)

 

	
  Total adjustments

  	
   

  	
  U.S.$

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total Final Payment Due (Line I(9) +/- total
  adjustment in II)

  	
   

  	
  U.S.$

  	
   

  

 

Contractor
certifies that (i) all Work (except for that Work and obligations that survive
the termination or expiration of the Agreement) has been completely performed
in accordance with the terms of the Agreement, including the completion of all
Punchlist items; (ii) all quantities and prices in this final Invoice or
attachments are correct and in accordance with the Agreement; (iii) fully
completed and executed Final Unconditional Lien and Claim Waivers from
Contractor, and from all Major Subcontractors and Major Sub-subcontractors who
performed Work for the Facility, as provided in Section 7.3 of the Agreement,
are attached to this final Invoice; (iv) all documentation required to be
delivered by Contractor to Owner under the Agreement, including Record Drawings
and Specifications, Owner’s Confidential Information and test reports, have
been delivered to Owner; (v) all of Contractor’s, Subcontractors’ and
Sub-subcontractors’ personnel, supplies, waste, materials, rubbish, and
temporary facilities have been removed from the Site; (vi) all Subcontractors
have been paid in accordance with the terms of their Subcontracts, except for
amounts that are the subject of this final Invoice or amounts that are properly
retained or withheld in accordance with the terms of such Subcontracts; (vii)
all payrolls, Taxes, bill for Equipment, and any other indebtedness connected
with the

 

I-9

 

Work (excluding
Corrective Work) has been paid; (viii) Contractor has delivered an executed Final
Completion Certificate, which has been accepted by Owner by signing such
certificate; (ix) Contractor has completed all other obligations required under
the Agreement for Final Completion; (x) attached to this final Invoice is all
documentation supporting Contractor’s request for payment as required under the
Agreement; and (xi) this final Invoice is signed by an authorized
representative of Contractor.

 

Payment is to be
made by wire transfer or ACH on or before [insert due date]
to:

The Bank of New York

New York, NY

Account #
8900512288

Acct. Type:
Checking (DDA) ACH Format: CTX

ABA # 021 000 018

Credit: Bechtel
Corporation

 

	
  CONTRACTOR

  
	
  Signed: 

  	
   

  	
   

  
	
  Name: 

  	
   

  	
   

  
	
  Title: 

  	
   

  	
   

  
	
  Date:

  	
   

  	
  , 200

  	
   

  	
   

  
								

 

I-10

 

SABINE PASS LNG RECEIVING,
STORAGE AND REGASIFICATION TERMINAL

 

	
  INVOICE NUMBER 

  	
  INVOICE DATE                         ,
  200     

  

 

OWNER APPROVAL

 

AMOUNT APPROVED by Owner
for Payment: U.S.$

 

	
  OWNER

  
	
  Signed: 

  	
   

  	
   

  
	
  Name: 

  	
   

  	
   

  
	
  Title: 

  	
   

  	
   

  
	
  Date:

  	
   

  	
  , 200

  	
   

  	
   

  
								

 

The AMOUNT APPROVED by
Owner is without prejudice to any rights of Owner under the Agreement.

 

Explanation is listed
below or attached if the AMOUNT APPROVED is less than the amount requested by
Contractor under this Invoice: 

 

 

 

 

I-11

 

EXHIBIT 1

 

COMPLETION
OF MILESTONES, MONTHLY PAYMENTS

AND
UNILATERAL CHANGE ORDERS

 

1.                                       MUTUAL
CHANGE ORDERS:  The following Change
Orders have been executed by Owner and Contractor pursuant to Section 6.1B or
Section 6.2C:

 

	
  No.

  	
   

  	
  Description of Change Order.

  	
   

  	
  U.S.$

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

2.                                       WORK
COMPLETED UNDER UNILATERAL CHANGE ORDERS: 
The following Work has been completed in accordance with this Agreement
under unilateral Change Orders executed by Owner pursuant to Section 6.1C or
Section 6.2D:

 

	
  No.

  	
   

  	
  Description of Unilateral Change

  Order(1)

  	
   

  	
  Work Completed

  (From Previous

  Invoices) (U.S.$)(2)

  	
   

  	
  Work Completed

  (This Period)

  (U.S.$)

  	
   

  	
  Total Work

  Completed

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

(1)  If the Parties have converted a unilateral
Change Order to mutual Change Order, list amounts in Section 6 of this Exhibit
1.

(2)  Amounts listed are subject to maximum
amounts, if any, listed in unilateral Change Orders.

 

3.                                       TOTAL
AMOUNTS PAID TO CONTRACTOR FOR MILESTONES COMPLETED:  The following amounts have been paid by Owner
to Contractor for Milestones completed and invoiced by Contractor:

 

	
  No.

  	
   

  	
  Description of Milestones

  	
   

  	
  Amount Paid to Contractor for Milestones

  Completed (From Previous Invoices)

  (U.S.$)(2)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

I-12

 

4.                                       TOTAL
AMOUNTS PAID TO CONTRACTOR FOR MONTHLY PAYMENTS:  The following amounts have been paid by Owner
to Contractor for Monthly Payments invoiced by Contractor:

 

	
  No.

  	
   

  	
  Amount Paid to Contractor for Monthly Payments

  (From Previous Invoices) (U.S.$)(2)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  

 

5.                                       TOTAL
AMOUNTS PAID TO CONTRACTOR FOR WORK COMPLETED UNDER UNILATERAL CHANGE ORDERS:  The following amounts have been paid to
Contractor for Work completed in accordance with this Agreement under
unilateral Change Orders executed by Owner pursuant to Section 6.1C or Section
6.2D:

 

	
  No.

  	
   

  	
  Description of Unilateral Change Order(1)

  	
   

  	
  Amount Paid to Contractor for Work

  Completed (From Previous Invoices) (U.S.$)(2)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

(1)  If the Parties have converted a unilateral
Change Order to mutual Change Order, list amounts in Section 3 of this Exhibit
1.

(2) Amounts listed are
subject to maximum amounts, if any, listed in unilateral Change Orders.

 

6.                                       MILESTONES
BILLED IN THIS FINAL INVOICE:  The
following Milestones have been completed by Contractor during the period
covered by this final Invoice and in accordance with the terms of the
Agreement:

 

	
  No.

  	
   

  	
  Description of Milestone

  	
   

  	
  Original Total for

  Milestone (U.S.$)

  	
   

  	
  Total for Milestone as

  Adjusted by Change Order

  (U.S.$)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

7.                                       MONTHLY
PAYMENT BILLED IN THIS FINAL INVOICE: 
The following Monthly is covered by this final Invoice and in accordance
with the terms of the Agreement:

 

	
  No.

  	
   

  	
  Original Total for Monthly

  Payment (U.S.$)

  	
   

  	
  Total for Monthly Payment as Adjusted

  by Change Order (U.S.$)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

8.                                       WORK
COMPLETED UNDER UNILATERAL CHANGE ORDERS AND BILLED IN THIS FINAL INVOICE :  The following Work has been completed by
Contractor during the period covered by this final Invoice

 

I-13

 

and in accordance with
this Agreement under unilateral Change Orders executed by Owner pursuant to
Section 6.1C or Section 6.2D:

 

	
  No.

  	
   

  	
  Description of Unilateral Change Order(1)

  	
   

  	
  Work Completed (This Period)

  (U.S.$)(2)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

(1)  If the Parties have converted a unilateral
Change Order to mutual Change Order, list amounts in Section 6 of this Exhibit
1.

(2) Amounts listed are
subject to maximum amounts, if any, listed in unilateral Change Orders.

 

I-14

 

EXHIBIT 2

 

FINAL
UNCONDITIONAL LIEN AND CLAIM WAIVERS

 

I-15

 

EXHIBIT 3

 

INFORMATION
REQUIRED OR REQUESTED BY OWNER

 

I-16

 

ATTACHMENT J

 

HSE
PLAN REQUIREMENTS

 

Within thirty (30) Days after Owner’s issuance of LNTP, Contractor
shall deliver to Owner for its review the health, safety and environmental (“HSE”) plan which shall include the
following sections:

 

•                                          Project
Outline, Scope and Project Organization

•                                          Action
Register

•                                          HSE
Interface Meetings

•                                          Defined
Roles and Responsibility

•                                          Organization
Charts Showing the HSE Organization and its Interfaces

•                                          Environmental
Plan

•                                          Waste
Management Plan

•                                          Construction
Environmental Control Plan

•                                          Construction
HSE Plan

•                                          Traffic
Management and Transportation Plan

•                                          HSE
Deliverables

•                                          Project
HSE Implementation Schedule

•                                          Interface
with FERC and permitting agencies through Owner

 

The HSE plan shall be developed for the Project as outlined below.

 

SECTION I – 100 SERIES

 

	
  Item

  	
   

  	
  Description

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.0

  	
   

  	
  HSE Policy - Zero Accident Philosophy

  	
   

  
	
  2.0

  	
   

  	
  Responsibilities

  	
   

  
	
  3.0

  	
   

  	
  Orientation & Training

  	
   

  
	
  4.0

  	
   

  	
  Medical Services & Medical Treatment

  	
   

  
	
  5.0

  	
   

  	
  Medical Reporting & Records

  	
   

  
	
  6.0

  	
   

  	
  Safe Task / Job Analysis

  	
   

  
	
  7.0

  	
   

  	
  Zero Injury Team

  	
   

  
	
  8.0

  	
   

  	
  Reporting / Investigating Incidents & Accidents

  	
   

  
	
  9.0

  	
   

  	
  Behavior Observation Process

  	
   

  
	
  10.0

  	
   

  	
  Back Injury Prevention Program

  	
   

  
	
  11.0

  	
   

  	
  HSE Assessments

  	
   

  
	
  12.0

  	
   

  	
  Regulatory Agency Inspections

  	
   

  
	
  13.0

  	
   

  	
  Subcontractor Training for Process Safety Management

  	
   

  

 

 

J-1

 

SECTION II – 200 SERIES

 

	
  14.0

  	
   

  	
  Tools & Equipment

  	
   

  
	
  15.0

  	
   

  	
  Hazard Communication

  	
   

  
	
  16.0

  	
   

  	
  Emergencies & Evacuations

  	
   

  
	
  17.0

  	
   

  	
  Bloodborne Pathogens

  	
   

  
	
  18.0

  	
   

  	
  Personal Protective Equipment

  	
   

  
	
  19.0

  	
   

  	
  Respiratory Protection

  	
   

  
	
  20.0

  	
   

  	
  Hearing Conservation Program

  	
   

  
	
  21.0

  	
   

  	
  Air Surveillance Program

  	
   

  
	
  22.0

  	
   

  	
  Construction Non-Destructive Testing

  	
   

  
	
  23.0

  	
   

  	
  Heat & Cold Stress Prevention

  	
   

  
	
  24.0

  	
   

  	
  House Keeping, Fire Prevention & Protection

  	
   

  
	
  25.0

  	
   

  	
  Fall Prevention / Protection

  	
   

  
	
  26.0

  	
   

  	
  Scaffolding

  	
   

  
	
  27.0

  	
   

  	
  Barricades

  	
   

  
	
  28.0

  	
   

  	
  Floor & Wall Openings

  	
   

  
	
  29.0

  	
   

  	
  Excavations & Trenching

  	
   

  
	
  30.0

  	
   

  	
  Vessels and Confined Spaces

  	
   

  
	
  31.0

  	
   

  	
  Lock out / Tag out Procedure

  	
   

  
	
  32.0

  	
   

  	
  Portable Ladders - Control & Inspection

  	
   

  
	
  33.0

  	
   

  	
  Cranes & Material Handling

  	
   

  
	
  34.0

  	
   

  	
  Suspended Personnel Platforms

  	
   

  
	
  35.0

  	
   

  	
  Articulating Boom Platforms

  	
   

  
	
  36.0

  	
   

  	
  Compressed Gas Cylinders

  	
   

  
	
  37.0

  	
   

  	
  Electrical Equipment Inspection/ Assured Grounding /
  GFCI

  	
   

  
	
  38.0

  	
   

  	
  Vehicle Operations

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION III – SPECIAL REQUIREMENTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.0

  	
   

  	
  General

  	
   

  
	
  2.0

  	
   

  	
  HSE Orientation

  	
   

  
	
  3.0

  	
   

  	
  Project Special Requirements

  	
   

  
	
  4.0

  	
   

  	
  Subcontract Special Requirements

  	
   

  

 

J-2

 

ATTACHMENT K

 

FORM OF
LIEN AND CLAIM WAIVERS

 

K-1

 

SCHEDULE K-1

 

CONTRACTOR’S INTERIM CONDITIONAL
LIEN WAIVER

(To be executed by Contractor
with each Invoice other than the Invoice for final payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The
undersigned, Bechtel Corporation (“Contractor”), has been engaged under
contract (“Agreement”) with Sabine Pass LNG, L.P. (“Owner”), for the
engineering, procurement, construction, commissioning, start-up and testing of
improvements known as the Sabine Pass LNG terminal (the “Facility”), which is
located in Cameron Parish, State of Louisiana, and is more particularly
described as follows:

 

 

 

                                                                                                                                                                              (the
“Property”).

 

Upon
receipt of the sum of U.S.$                                       
(amount in Invoice submitted with this Contractor’s Interim Conditional Lien
Waiver), Contractor waives, relinquishes, remits and releases any and all
privileges, liens or claims of privileges or liens against the Facility and the
Property that Contractor has or may have arising out of the performance or
provision of the work, materials, equipment, services or labor by or on behalf
of Contractor (including, without limitation, any Subcontractor or
Sub-subcontractor) in connection with the Facility through the date of                                         ,
20     (date of the Invoice submitted with this
Contractor’s Interim Conditional Lien Waiver) and reserving those rights,
privileges and liens, if any, that Contractor might have in respect of any
amounts: (i) withheld by Owner under the terms of the Agreement from payment on
account of work, materials, equipment, services and/or labor furnished by or on
behalf of Contractor to or on account of Owner for the Facility; or (ii) for
Work performed in connection with Milestones listed in Schedule C-1 of
the Agreement which have not yet been billed in the Invoice submitted with this
Contractor’s Interim Conditional Lien Waiver or in prior Invoices.  Other exceptions are as follows:

 

 

 

(if
no exception entry or “none” is entered above, Contractor shall be deemed not
to have reserved any claim.)

 

Contractor
expressly represents and warrants that all employees, laborers, materialmen,
Subcontractors and Sub-subcontractors employed by Contractor have been paid in
accordance with their respective contracts or subcontracts for all work,
materials, equipment, services, labor and any other items performed or provided
in connection with the Facility through                      ,
20      (date of Contractor’s last prior
Invoice).   Exceptions are as follows:

 

 

 

(if
no exception entry or “none” is entered above, all such payments have been made
)

 

This
Contractor’s Interim Conditional Lien Waiver is freely and voluntarily given
and Contractor acknowledges and represents that it has fully reviewed the terms
and conditions of this Contractor’s Interim Conditional Lien Waiver, that it is
fully informed with respect to the legal effect of this Contractor’s Interim
Conditional Lien Waiver, and that it has voluntarily chosen to accept the terms
and conditions of this Contractor’s Interim Conditional Lien Waiver in return
for the payment recited above.

 

This
Contractor’s Interim Conditional Lien Waiver has been executed by its duly
authorized representative.

 

FOR
CONTRACTOR:

Applicable to Invoice(s) No.    

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-2

 

SCHEDULE K-2

 

CONTRACTOR’S INTERIM
UNCONDITIONAL LIEN WAIVER

(To be executed by Contractor
with each Invoice other than the Invoice for final payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The
undersigned, Bechtel Corporation (“Contractor”), has been engaged under
contract (“Agreement”) with Sabine Pass LNG, L.P. (“Owner”), for the
engineering, procurement, construction, commissioning, start-up and testing of
improvements known as the Sabine Pass LNG terminal (the “Facility”), which is
located in Cameron Parish, State of Louisiana, and is more particularly
described as follows:

 

 

 

                                                                                                                                                                              (the
“Property”).

 

Contractor
hereby waives, relinquishes, remits and releases any and all privileges, liens
or claims of privileges or liens against the Facility and the Property that
Contractor has or may have arising out of the performance or provision of the
work, materials, equipment, services or labor by or on behalf of Contractor
(including, without limitation, any subcontractor or sub-subcontractor) in
connection with the Facility through the date of                                            ,
20       (date of the last Invoice submitted by
Contractor) and reserving those rights, privileges and liens, if any, that
Contractor might have in respect of any amounts: (i) withheld by Owner under
the terms of the Agreement from payment on account of work, materials,
equipment, services and/or labor furnished by or on behalf of Contractor to or
on account of Owner for the Facility; or (ii) for Work performed in connection
with Milestones listed in Schedule C-1 of the Agreement which have not
yet been billed to Owner by the date of the last Invoice submitted by
Contractor.   Other exceptions are as
follows:

 

 

 

(if
no exception entry or “none” is entered above, Contractor shall be deemed not
to have reserved any claim.)

 

Contractor
expressly represents and warrants that all employees, laborers, materialmen,
Subcontractors and Sub-subcontractors employed by Contractor have been paid in
accordance with their respective contracts or subcontracts for all work,
materials, equipment, services, labor and any other items performed or provided
in connection with the Facility through                       ,
20      (date of Contractor’s last prior Invoice).

 

This
Contractor’s Interim Unconditional Lien Waiver is freely and voluntarily given
and Contractor acknowledges and represents that it has fully reviewed the terms
and conditions of this Contractor’s Interim Unconditional Lien Waiver, and that
it is fully informed with respect to the legal effect of this Contractor’s
Interim Unconditional Lien Waiver.

 

This
Contractor’s Interim Unconditional Lien Waiver has been executed by its duty
authorized representative.

 

FOR
CONTRACTOR:

Applicable to Invoice(s) No.    

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-3

 

SCHEDULE K-3

 

SUBCONTRACTOR’S INTERIM CONDITIONAL LIEN WAIVER

(To be executed by Major Subcontractors and Major Sub-subcontractors

with each Invoice other than the Invoice for final payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The
undersigned,                                             
(“Subcontractor”) who has, under an agreement with Bechtel Corporation
(“Contractor”), furnished certain materials, equipment, services, and/or labor
for the facility known as the Sabine Pass LNG terminal (“Facility”), which is
located in Cameron Parish, State of Louisiana and is more particularly
described as follows:

 

 

 

 

                                                                                                                                                                     (the
“Property”).

 

Upon
receipt of the sum of U.S.$                                    
(amount in Invoice submitted with this Subcontractor’s Interim Conditional Lien
Waiver), Subcontractor waives, relinquishes, remits and releases any and all
privileges, liens or claims of privileges or liens against the Facility and the
Property that Subcontractor has or may have arising out of the performance or
provision of the work, materials, equipment, services or labor or on behalf of
Subcontractor (including, without limitation, any sub-subcontractor) in connection
with the Facility through the date of                                           ,
20       (date of the Invoice submitted with this
Subcontractor’s Interim Conditional Lien Waiver) and reserving those rights,
privileges and liens, if any, that Subcontractor might have in respect of any
amounts withheld by Contractor from payment on account of work, materials,
equipment, services and/or labor furnished by or on behalf of Subcontractor to
or on account of Contractor for the Facility. 
Other exceptions are as follows:

 

 

 

(if
no exception entry or “none” is entered above, Subcontractor shall be deemed
not to have reserved any claim.)

 

Subcontractor
expressly represents and warrants that all employees, laborers, materialmen,
Sub-subcontractors and subconsultants employed by Subcontractor in connection
with the Facility have been paid for all work, materials, equipment, services,
labor and any other items performed or provided through                                 ,
20     (date of Subcontractor’s last prior invoice).   Exceptions are as follows:

 

 

 

 

(if
no exception entry or “none” is entered above, all such payments have been
made)

 

This
Subcontractor’s Interim Conditional Lien Waiver is freely and voluntarily given
and Subcontractor acknowledges and represents that it has fully reviewed the
terms and conditions of this Subcontractor’s Interim Conditional Lien Waiver,
that it is fully informed with respect to the legal effect of this
Subcontractor’s Interim Conditional Lien Waiver, and that it has voluntarily
chosen to accept the terms and conditions of this Subcontractor’s Interim
Conditional Lien Waiver in return for the payment recited above.

 

This
Subcontractor’s Interim Conditional Lien Waiver has been executed by its duly
authorized representative.

 

FOR SUBCONTRACTOR :

Applicable to Invoice(s) No.    

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-4

 

SCHEDULE K-4

 

SUBCONTRACTOR’S INTERIM
UNCONDITIONAL LIEN WAIVER

(To be executed by Major Subcontractors and Major Sub-subcontractors

with each Invoice other than the Invoice for final payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The
undersigned,                                            
(“Subcontractor”) who has, under an agreement with Bechtel Corporation
(“Contractor”), furnished certain materials, equipment, services, and/or labor
for the facility known as the Sabine Pass LNG terminal (“Facility”), which is
located in Cameron Parish, State of Louisiana and is more particularly
described as follows:

 

 

 

 

                                                                                                                                                                                    (the
“Property”).

 

Subcontractor hereby waives, relinquishes, remits and releases any and
all privileges, liens or claims of privileges or liens against the Facility and
the Property that Subcontractor has or may have arising out of the performance
or provision of the work, materials, equipment, services or labor or on behalf
of Subcontractor (including, without limitation, any sub-subcontractor) in
connection with the Facility through the date of                                                  ,
20        (date of the last invoice
submitted by Subcontractor).

 

Subcontractor
expressly represents and warrants that all employees, laborers, materialmen,
Sub-subcontractors and subconsultants employed by Subcontractor in connection
with the Facility have been paid for all work, materials, equipment, services,
labor and any other items performed or provided through                                ,
20     (date of Subcontractor’s last prior invoice).

 

This
Subcontractor’s Interim Unconditional Lien Waiver is freely and voluntarily
given and Subcontractor acknowledges and represents that it has fully reviewed
the terms and conditions of this Subcontractor’s Interim Unconditional Lien
Waiver, and that it is fully informed with respect to the legal effect of this
Subcontractor’s Interim Unconditional Lien Waiver.

 

This
Subcontractor’s Interim Unconditional Lien Waiver has been executed by its duly
authorized representative.

 

FOR SUBCONTRACTOR :

Applicable to Invoice(s) No.     

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-5

 

SCHEDULE K-5

 

CONTRACTOR’S FINAL CONDITIONAL LIEN AND CLAIM WAIVER

(To be executed by Contractor with the Invoice for final payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The undersigned, Bechtel Corporation (“Contractor”), has been engaged
under contract (“Agreement”) with Sabine Pass LNG, L.P. (“Owner”), for the
engineering, procurement, construction, commissioning, start-up and testing of
improvements known as the Sabine Pass LNG terminal (“Facility”), which is
located in Cameron Parish, State of Louisiana and is more particularly
described as follows:

 

 

 

 

                                                                                                                                                                                    
(the “Property”).

 

Upon
receipt of the sum of U.S.$                                                  
(amount in Invoice for final payment submitted with this Contractor’s Final
Conditional Lien and Claim Waiver), Contractor waives, relinquishes, remits and
releases any and all privileges, liens or claims of privileges or liens against
the Facility and the Property and all claims, demands, actions, causes of
actions or other rights at law, in contract, quantum meruit, unjust enrichment,
tort, equity or otherwise that Contractor has or may have had against Owner
arising out of the Agreement or the Facility, whether or not known to
Contractor at the time of the execution of this Contractor’s Final Conditional
Lien and Claim Waiver, except for the following disputed claims for extra work
in the amount of U.S.$                                             :

 

 

 

(if
no exception entry or “none” is entered above, Contractor shall be deemed not
to have reserved any claim.)

 

Except for work and obligations that survive the termination or
expiration of the Agreement, including, without limitation, Warranties and
correction of Defective Work, Contractor represents that all of its
obligations, legal, equitable, or otherwise, relating to or arising out of the
Agreement or the Facility have been fully satisfied.

 

This Contractor’s Final Conditional Lien and Claim Waiver is freely and
voluntarily given, and Contractor acknowledges and represents that it has fully
reviewed the terms and conditions of this Contractor’s Final Conditional Lien
and Claim Waiver, that it is fully informed with respect to the legal effect of
this Contractor’s Final Conditional Lien and Claim Waiver, and that it has
voluntarily chosen to accept the terms and conditions of this Contractor’s
Final Conditional Lien and Claim Waiver in return for the payment recited above.  Contractor understands, agrees and
acknowledges that, upon payment, this document waives rights and is fully
enforceable to extinguish all claims of Contractor as of the date of execution
of this document by Contractor.

 

This Contractor’s Final Conditional Lien and Claim Waiver has been
executed by its duly authorized representative.

 

FOR
CONTRACTOR:

Applicable to Invoice No(s):           ALL           (If
all, print “all”)

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-6

 

SCHEDULE K-6

 

CONTRACTOR’S FINAL UNCONDITIONAL LIEN AND CLAIM WAIVER

(To be executed by Contractor prior to the receipt of final payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The undersigned, Bechtel Corporation (“Contractor”), has been engaged
under contract (“Agreement”) with Sabine Pass LNG, L.P. (“Owner”), for the
engineering, procurement, construction, commissioning, start-up and testing of
improvements known as the Sabine Pass LNG terminal (“Facility”), which is
located in Cameron Parish, State of Louisiana and is more particularly
described as follows:

 

 

 

                                                                                                                                                                              
(the “Property”).

 

Contractor
has been paid in full for all work, materials, equipment, services and/or labor
furnished in connection with the Facility, and Contractor hereby waives,
relinquishes, remits and releases any and all privileges, liens or claims of
privileges or liens against the Facility and the Property and all claims,
demands, actions, causes of actions or other rights at law, in contract,
quantum meruit, unjust enrichment, tort, equity or otherwise that Contractor
has or may have had against Owner arising out of the Agreement or the Facility,
whether or not known to Contractor at the time of the execution of this
Contractor’s Final Unconditional Lien and Claim Waiver, except for the
following disputed claims for extra work in the amount of U.S.$                                             :

 

 

 

(if
no exception entry or “none” is entered above, Contractor shall be deemed not
to have reserved any claim.)

 

Except for work and obligations that survive the termination or
expiration of the Agreement, including, without limitation, Warranties and
correction of Defective Work, Contractor represents that all of its
obligations, legal, equitable, or otherwise, relating to or arising out of the
Agreement or the Facility have been fully satisfied, including, but not limited
to payment to Subcontractors and employees and payment of Taxes.

 

This Contractor’s Final Unconditional Lien and Claim Waiver is freely
and voluntarily given, and Contractor acknowledges and represents that it has
fully reviewed the terms and conditions of this Contractor’s Final
Unconditional Lien and Claim Waiver, and that it is fully informed with respect
to the legal effect of this Contractor’s Final Unconditional Lien and Claim
Waiver.  Contractor understands, agrees
and acknowledges that, upon execution of this document, this document waives
rights unconditionally and is fully enforceable to extinguish all claims of
Contractor as of the date of execution of this document by Contractor.

 

This Contractor’s Final Unconditional Lien and Claim Waiver has been
executed by its duly authorized representative.

 

FOR
CONTRACTOR:

Applicable to Invoice No(s):         ALL         (If
all, print “all”)

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-7

 

SCHEDULE K-7

 

SUBCONTRACTOR’S FINAL
CONDITIONAL LIEN AND CLAIM WAIVER

(To be executed by Major
Subcontractors and Major Sub-subcontractors with their invoice for final
payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The undersigned,                                        
(“Subcontractor”), has, under an agreement with Bechtel Corporation
(“Contractor”), furnished certain materials, equipment, services, and/or labor
for the facility known as the Sabine Pass LNG terminal (“Facility”), which is
located in Cameron Parish, State of Louisiana, and is more particularly
described as follows:

 

 

 

                                                                                                                                                                               (the
“Property”).

 

Upon
receipt of the sum of U.S.$                               ,  Subcontractor waives, relinquishes, remits
and releases any and all privileges and liens or claims of privileges or liens
against the Facility and the Property, and all claims, demands, actions, causes
of action or other rights at law, in contract, quantum meruit, unjust
enrichment, tort, equity or otherwise against Sabine Pass LNG, L.P. (“Owner”)
or Contractor,  which Subcontractor has,
may have had or may have in the future arising out of the agreement between
Subcontractor and Contractor or the Facility, whether or not known to
Subcontractor at the time of the execution of this Subcontractor’s Final
Conditional Lien and Claim Waiver.

 

Except for work and obligations that survive the termination or expiration
of the agreement between Subcontractor and Contractor, including warranties and
correction of defective work, Subcontractor represents that all of its
obligations, legal, equitable, or otherwise, relating to or arising out of the
agreement between Contractor and Subcontractor, the Facility or
sub-subcontracts have been fully satisfied.

 

This Subcontractor’s Final Conditional Lien and Claim Waiver is freely
and voluntarily given and Subcontractor acknowledges and represents that it has
fully reviewed the terms and conditions of this Subcontractor’s Final
Conditional Lien and Claim Waiver, that it is fully informed with respect to
the legal effect of this Subcontractor’s Final Conditional Lien and Claim
Waiver, and that it has voluntarily chosen to accept the terms and conditions
of this Subcontractor’s Final Conditional Lien and Claim Waiver in return for
the payment recited above.  Subcontractor
understands, agrees and acknowledges that, upon payment, this document waives
rights and is fully enforceable to extinguish all claims of Subcontractor as of
the date of execution of this document by Subcontractor.

 

This Subcontractor’s Final Conditional Lien and Claim Waiver has been
executed by its duly authorized representative.

 

 

FOR
SUBCONTRACTOR:

Applicable to Invoice No(s).               ALL                                  (If
all, print “all”)

 

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-8

 

SCHEDULE K-8

 

SUBCONTRACTOR’S FINAL
UNCONDITIONAL LIEN AND CLAIM WAIVER

(To be executed by Major
Subcontractors and Major Sub-subcontractor as a condition of them receiving
final payment)

 

STATE
OF 

COUNTY/PARISH
OF 

 

The undersigned,                                    
(“Subcontractor”), has, under an agreement with Bechtel Corporation
(“Contractor”), furnished certain materials, equipment, services, and/or labor
for the facility known as the Sabine Pass LNG terminal (“Facility”), which is
located in Cameron Parish, State of Louisiana, and is more particularly
described as follows:

 

 

                                                                                                                                                                           (the
“Property”).

 

Subcontractor
has been paid in full for all work, materials, equipment, services and/or labor
furnished by or on behalf of Subcontractor to or on account of Contractor for
the Facility, and Contractor hereby waives waives, relinquishes, remits and
releases any and all privileges and liens or claims of privileges or liens
against the Facility and the Property, and all claims, demands, actions, causes
of action or other rights at law, in contract, quantum meruit, unjust
enrichment, tort, equity or otherwise against Sabine Pass LNG, L.P. (“Owner”)
or Contractor, which Subcontractor has, may have had or may have in the future
arising out of the agreement between Subcontractor and Contractor or the
Facility, whether or not known to Subcontractor at the time of the execution of
this Subcontractor’s Final Unconditional Lien and Claim Waiver.

 

Except for work and obligations that survive the termination or
expiration of the agreement between Subcontractor and Contractor, including
warranties and correction of defective work, Subcontractor represents that all
of its obligations, legal, equitable, or otherwise, relating to or arising out
of the agreement between Contractor and Subcontractor, the Facility or
sub-subcontracts have been fully satisfied, including, but not limited to
payment to sub-subcontractors and employees of Subcontractor and payment of
taxes.

 

This Subcontractor’s Final Unconditional Lien and Claim Waiver is freely
and voluntarily given and Subcontractor acknowledges and represents that it has
fully reviewed the terms and conditions of this Subcontractor’s Final
Unconditional Lien and Claim Waiver, and that it is fully informed with respect
to the legal effect of this Subcontractor’s Final Unconditional Lien and Claim
Waiver.  Subcontractor understands,
agrees and acknowledges that, upon execution of this document, this document
waives rights unconditionally and is fully enforceable to extinguish all claims
of Subcontractor as of the date of execution of this document by Subcontractor.

 

This Subcontractor’s Final Unconditional Lien and Claim Waiver has been
executed by its duly authorized representative.

 

FOR
SUBCONTRACTOR:

Applicable to Invoice No(s).         ALL                                   (If
all, print “all”)

 

	
  Signed:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
					

 

K-9

 

ATTACHMENT L

 

FORM OF
RFCD COMPLETION CERTIFICATE

 

	
   

  	
  Date:

  

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Attention: Ed Lehotsky

 

Re:                               RFCD
Completion Certificate — Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Sabine Pass LNG Receiving, Storage and
Regasification Terminal, dated as of December 18, 2004 (the “Agreement”), by and between Sabine
Pass LNG, L.P. (“Owner”) and Bechtel
Corporation (“Contractor”)

 

Pursuant to Section 11.1
of the Agreement, Contractor hereby certifies that it has completed all
requirements under the Agreement for RFCD, including: (i) Contractor has
completed applicable Work, other than the Work meeting the definition of
Punchlist, in accordance with the requirements contained in this Agreement to
ensure that System 1, the first System to undergo Cool Down, is ready for use
to receive and dispatch LNG and Natural Gas so that the Cool Down phase can
commence; and (ii) Contractor hereby delivers this RFCD Completion Certificate
as required under Section 11.1 of the Agreement.

 

Attached is supporting
documentation which is reasonably required to establish that the requirements
for RFCD under the Agreement have been met.

 

Contractor certifies that
it achieved all requirements under the Agreement for RFCD on                       ,
200   , including the payment of all Liquidated Damages invoiced
by Owner pursuant to Section 20.3C and owed under the Agreement (if any), or if
any such Liquidated Damages have not been paid upon the date of this RFCD
Completion Certificate, such Liquidated Damages will be paid by Contractor
within ten (10) Days after Contractor’s receipt of Owner’s invoice for such
Liquidated Damages.

 

IN WITNESS WHEREOF,
Contractor has caused this RFCD Completion Certificate to be duly executed and
delivered as of the date first written above.

 

	
   

  	
  BECHTEL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
						

 

cc:                                 Sabine Pass LNG, L.P.

717 Texas Avenue, Suite 3100

Houston, Texas 77002

Attn: General Counsel

 

L-1

 

Owner
Acceptance or Rejection of RFCD Completion Certificate

 

Pursuant
to Section 11.4A of the Agreement, Owner                    
accepts or                        
rejects (check one) the RFCD Completion Certificate.

 

If
RFCD was achieved, RFCD was achieved on                        ,
200    .

 

Acceptance
of RFCD shall not relieve Contractor of any of Contractor’s obligations to
perform the Work in accordance with the requirements of the Agreement, nor
shall it in any way release Contractor or any surety of Contractor from
any obligations or liability pursuant to the Agreement, including obligations
with respect to unperformed obligations of the Agreement or for any Work that
does not conform to the requirements of this Agreement.

 

Acceptance
of the RFCD Completion Certificate is subject to the timely receipt by Owner of
any Liquidated Damages due and owing to Owner and invoiced by Owner in
accordance with Section 20.3C of the Agreement.

 

The
basis for any rejection of RFCD is attached hereto.

 

 

	
   

  	
  For
  and on behalf of

  
	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Sabine Pass LNG-LP,
  Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
							

 

L-2

 

ATTACHMENT M

 

FORM OF
SUBSTANTIAL COMPLETION CERTIFICATE

 

	
   

  	
  Date:

  

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Attention: Ed Lehotsky

 

Re:                               Substantial
Completion Certificate — Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Sabine Pass LNG Receiving, Storage and
Regasification Terminal, dated as of December 18, 2004 (the “Agreement”), by and between Sabine
Pass LNG, L.P. (“Owner”) and Bechtel
Corporation (“Contractor”)

 

Pursuant to Section 11.3
of the Agreement, Contractor hereby certifies that it has completed all
requirements under the Agreement for Substantial Completion with respect to the
Facility, including: (i) all Minimum Acceptance Criteria have been achieved;
(ii) all Performance Guarantees for the Facility have been achieved, or in the
case that all Performance Guarantees have not been achieved but all Minimum
Acceptance Criteria have been achieved, Contractor has paid Performance
Liquidated Damages in accordance with Section 20.3C (except such Performance
Liquidated Damages that are not due as a condition of Substantial Completion if
Contractor, at Owner’s election, is taking corrective actions under Section
11.5A(i)); (iii) any Substantial Completion Delay Liquidated Damages due and
owing have been paid in accordance with Section 20.3C; (iv) the Work (including
training, in accordance with Section 3.5 and the delivery of all documentation
required as a condition of Substantial Completion under this Agreement
(including documentation required for operation, including test reports)) has
been completed in accordance with the requirements of the Agreement other than
any Work which meets the definition of Punchlist; (v) Contractor hereby
delivers this Substantial Completion Certificate, as required pursuant to
Sections 11.3 of the Agreement; (vi) Contractor has obtained all Contactor
Permits for the Facility and (vii)  Contractor has, pursuant to Section
3.4, delivered to the Project all Operating Spare Parts required by the
Operating Spare Parts List to be delivered to the Project prior to Substantial
Completion.

 

To the extent Owner has
provided an invoice(s) for Liquidated Damages to Contractor pursuant to Section
20.3C of the Agreement, Contractor certifies that it has                     
or has not                                 
(check one) paid to Owner all such Liquidated Damages.

 

Contractor certifies that
it achieved all requirements under the Agreement for Substantial Completion on                              ,
200    , including the payment of Liquidated Damages owed
under the Agreement (if any), or if any such Liquidated Damages have not been
paid upon the date of this Substantial Completion Certificate, such Liquidated
Damages will be paid by Contractor within ten (10) Days after Contractor’s
receipt of Owner’s invoice for such Liquidated Damages.

 

Attached is all
information required to be provided by Contractor with this Certificate under
Section 11.3 of the Agreement, including the Performance Test report and
analysis and those requirements set forth in writing between the Parties for
the Performance Test Procedures.

 

[Signature
Page Follows]

 

M-1

 

IN WITNESS WHEREOF,
Contractor has caused this Substantial Completion Certificate to be duly
executed and delivered as of the date first written above.

 

	
   

  	
  BECHTEL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  cc:

  	
  Sabine Pass LNG, L.P.

  	
   

  
	
   

  	
  717 Texas Avenue, Suite
  3100

  	
   

  
	
   

  	
  Houston, Texas 77002

  	
   

  
	
   

  	
  Attn: General Counsel

  	
   

  
							

 

M-2

 

Owner
Acceptance or Rejection of Substantial Completion Certificate

 

Pursuant
to Section 11.4B of the Agreement, Owner                   
accepts or                      
rejects (check one) the Substantial Completion Certificate.

 

If
Substantial Completion was achieved, Substantial Completion was achieved on                        ,
200        .

 

Acceptance
of Substantial Completion shall not relieve Contractor of any of Contractor’s
obligations to perform the Work in accordance with the requirements of the
Agreement, nor shall it in any way release Contractor or any surety of
Contractor from any obligations or liability pursuant to the Agreement,
including obligations with respect to unperformed obligations of the Agreement
or for any Work that does not conform to the requirements of this Agreement.

 

The
basis for any rejection of Substantial Completion is attached hereto.

 

 

	
   

  	
  For
  and on behalf of

  
	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Sabine Pass LNG-LP,
  Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
							

 

M-3

 

ATTACHMENT N

 

FORM OF
FINAL COMPLETION CERTIFICATE

 

	
   

  	
  Date:

  

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Attention: Ed Lehotsky

 

Re:                               Final
Completion Certificate — Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Sabine Pass LNG Receiving, Storage and
Regasification Terminal, dated as of December 18, 2004 (the “Agreement”), by and between Sabine
Pass LNG, L.P. (“Owner”) and Bechtel
Corporation (“Contractor”)

 

Pursuant to Section 11.7
of the Agreement, Contractor hereby certifies that all Work and all other
obligations under the Agreement (except for that Work and obligations that
survive the termination or expiration of the Agreement, including obligations
for Warranties and correction of Defective Work pursuant to Section 12.3 and
any other obligations covered under Section 11.7) are fully and completely
performed in accordance with the terms of the Agreement, including: (i) the achievement
of Substantial Completion; (ii) any and all Liquidated Damages due and owning
have been paid to Owner in accordance with Section 20.3C; (iii) the completion
of all Punchlist items; (iv) delivery by Contractor to Owner of a fully executed
Final Conditional Lien and Claim Waivers in the form of Schedule K-3;
(v) delivery by Contractor to Owner of all documentation expressly required to
be delivered under the Agreement as a prerequisite of achievement of Final
Completion, including Record Drawings; (vi) removal from the Site of all of
Contractor’s, Subcontractors’ and Sub-subcontractor’s personnel, supplies,
waste, materials, rubbish, and temporary facilities; (vii) delivery by
Contractor to Owner of fully executed Final Conditional Lien and Claim Waivers
from all Major Subcontractors in the form of Schedule K-4; (viii)
fully executed Final Conditional Lien and Claim Waivers from Major
Sub-subcontractors in a form substantially similar to the forms in Schedule
K-4; (ix) Contractor hereby delivers this Final Completion Certificate
as required under Section 11.7 of the Agreement; and (x) Contractor has,
pursuant to Section 3.4, delivered to the Project all Operating Spare Parts
required by the Operating Spare Parts List to be delivered to the Project prior
to Final Completion.

 

Contractor certifies that
it achieved all requirements under the Agreement for Final Completion on                                          ,
200    .

 

Attached is all
documentation required under the Agreement to be provided by Contractor with
this Final Completion Certificate.

 

IN WITNESS WHEREOF,
Contractor has caused this Final Completion Certificate to be duly executed and
delivered as of the date first written above.

 

	
   

  	
  BECHTEL CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
						

 

cc:                                 Sabine Pass LNG, L.P.

717 Texas Avenue, Suite 3100

Houston, Texas 77002

Attn: General Counsel

 

N-1

 

Owner
Acceptance or Rejection of Final Completion Certificate

 

Pursuant
to Section 11.7 of the Agreement, Owner                      
accepts or                        
rejects (check one) the Final Completion Certificate.

 

If
Final Completion was achieved, Final Completion was achieved on                           ,
200    .

 

Acceptance
of Final Completion shall not relieve Contractor of any of Contractor’s
remaining obligations in accordance with the requirements of the Agreement, nor
shall it in any way release Contractor or any surety of Contractor from
any obligations or liability pursuant to the Agreement, including obligations
with respect to unperformed obligations of the Agreement or for any Work that
does not conform to the requirements of this Agreement, including Warranty
obligations.

 

The
basis for any rejection of Final Completion is attached hereto.

 

 

	
   

  	
  For
  and on behalf of

  
	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Sabine Pass LNG-LP,
  Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
							

 

N-2

 

ATTACHMENT O

 

INSURANCE REQUIREMENTS

 

1.                                       Contractor’s
Insurance.

 

A.                                   Types
and Amounts of Insurance.  Subject to
Section 7.1B of the Agreement, Contractor shall at its own cost and expense procure
and maintain in full force and effect at all times specified in Section 1B the
following insurances on an occurrence basis for coverages at not less than the
following limits of liability:

 

1.                                       Workers’
Compensation and Employer’s Liability Insurance. Contractor shall comply
with Applicable Law with respect to workers’ compensation requirements and
other similar requirements where the Work is performed and shall procure and
maintain workers’ compensation and employer’s liability policies in accordance
with Applicable Law and the requirements of this Agreement.  These policies shall include coverage for all
states and other applicable jurisdictions, voluntary compensation coverage,
alternate employer endorsement and occupational disease.  If the Work is to be performed on or near
navigable waters, the policies shall include coverage for United States
Longshoremen’s and Harbor Workers’ Act, Death on the High Seas Act, the Jones
Act, the Outer Continental Shelf Lands Act, and other Applicable Law regarding
maritime law.  A maritime employer’s
liability policy may be used to satisfy applicable parts of this requirement
with respect to Work performed on or near navigable waters.  If Contractor is not required by Applicable
Law to carry workers’ compensation insurance, then Contractor shall provide the
types and amounts of insurance which are mutually agreeable to the Parties.

 

Minimum limits:

 

Workers’ Compensation:
Statutory

 

Employer’s Liability:
U.S.$1,000,000 each accident, U.S.$1,000,000 disease each employee and
U.S.$1,000,000 disease policy limit

 

2.                                       Commercial
General Liability Insurance.  This
policy shall provide coverage against claims for bodily injury (including
bodily injury and death), property damage (including loss of use) and personal
injury, and shall include contractual liability (such coverage not to be written
on a limited basis) insuring the indemnity obligations assumed by Contractor
under the Agreement, products and completed operations coverage (for a minimum
of five (5) years after Substantial Completion), premises and operations
coverage, broad form property damage coverage, independent contractors, actions
over indemnity coverage, sudden and accidental pollution liability coverage
including clean up on or off the Site, non-owned watercraft liability and
deletion of any explosion, collapse, or underground exclusions.  The policy shall be endorsed to provide
coverage wherever the Work is performed. 
The aggregate limits shall apply separately to each annual policy period,
except for the products and completed operations coverage, which shall be a
Project aggregate.  This coverage will be
subject to a maximum deductible of U.S.$25,000.

 

O-1

 

Minimum
limits:                    U.S.$1,000,000
combined single limit each occurrence

 

U.S.$2,000,000 general
aggregate, with such limits dedicated to the Project

 

U.S.$2,000,000 products
and completed operations aggregate, with such limits dedicated to the Project

 

3.                                 Commercial
Automobile Insurance.  This policy
shall include coverage for all owned, hired, rented, and non-owned automobiles
and equipment.  This coverage will be
subject to a maximum deductible of U.S.$25,000.

 

Minimum
limit:                      U.S.$1,000,000
combined single limit each accident

 

4.                                       Umbrella
or Excess Liability Insurance.  This
policy shall be written on a “following form” basis and shall provide coverage
in excess of the coverages required to be provided by Contractor for employer’s
liability insurance, commercial general liability insurance, maritime employer’s
liability insurance, aircraft liability insurance and commercial automobile
liability insurance.  The aggregate limit
shall apply separately to each annual policy period, except for the products
and completed operations coverage, which shall be a Project aggregate.

 

Minimum limits:

 

At LNTP:

 

U.S.$ 10,000,000 combined
single limit each occurrence

 

U.S.$ 10,000,000
aggregate limit, with such limits dedicated to the Project

 

At NTP:

 

U.S.$ 100,000,000
combined single limit each occurrence

 

U.S.$ 100,000,000
aggregate limit, with such limits dedicated to the Project

 

5.                                             Aircraft
Liability Insurance.  If applicable,
this policy shall provide coverage for bodily injury and property damage and
shall cover aircraft that is owned, leased, rented or chartered by
Contractor.  The policy shall include
coverage for passengers and crew, cover all owned and non-owned aircraft, and
be endorsed to provide a voluntary settlement.

 

Minimum
limit:                      U.S.$10,000,000
per occurrence

 

O-2

 

6.                                 Hull
and Machinery Insurance.  This policy
shall be provided by Contractor if applicable and shall cover any watercraft
that is owned, leased, rented or chartered by Contractor.  If not provided for in the protection and
indemnity policy in Section 1A.7 of this Attachment O, this policy
shall include collision liability and tower’s liability with sister-ship clause
un-amended.  All “as owner” and “other
than owner” clauses shall be deleted, and navigational limitations shall be
adequate for Contractor to perform the specified Work.

 

Hull: Fair Market Value of each vessel

 

7.                                             Protection
and Indemnity Insurance (P&I). 
This policy shall be provided by Contractor if applicable and shall cover
any watercraft that is owned, leased, rented or chartered by Contractor.  The coverage provided shall include marine
contractual liability, tankerman’s liability, pollution liability, removal of
wreck and/or debris, and if not provided for in the hull and machinery policy,
collision liability and tower’s liability with sister-ship clause
un-amended.  All “as owner” and “other
than owner” clauses shall be deleted, and navigational limitations shall be
adequate for Contractor to perform the specified Work.

 

If
pollution liability coverage is not provided by the P&I underwriter,
pollution liability insurance shall be separately provided that will cover
bodily injury, property damage, including cleanup costs and defense costs
imposed under Applicable Law (including the Oil Pollution Act of 1990 (OPA) and
the Comprehensive Environmental Response Compensation and Liability Act (CERCLA)),
resulting from pollution conditions of contaminants or pollutants into or upon
the land, the atmosphere or any water course or body of water.

 

Minimum
Limits:                   Protection and
indemnity coverage provided with a minimum limit of U.S.$100,000,000.  (This limit may be satisfied with a minimum
underlying limit of U.S.$1,000,000 and the remaining U.S.$99,000,000 provided
through excess P&I coverage which “follows form” with the underlying
policy.)

 

Pollution liability
coverage provided with a minimum limit of U.S.$100,000,000.

 

8.                                       Contractor’s
Construction Equipment Floater. 
Contractor shall maintain (or self-insure) equipment insurance covering
all Construction Equipment and items (whether owned, rented, or borrowed) of
Contractor that will not become part of the Facility.  It is understood that this coverage shall not
be included under the builders risk policy.

 

9.                                       Builder’s Risk Insurance.  Property
damage insurance on an “all risk” basis insuring Contractor, Owner and Lender,
as their interests may appear, including coverage against loss or damage from
the perils of earth movement (including earthquake, landslide,

 

O-3

 

subsidence and volcanic eruption), flood, windstorm, startup and
testing, strike, riot, civil commotion and malicious damage but excluding
terrorism.

 

(a)                                  Property Covered:  The
insurance policy shall provide coverage for (i) the buildings, structures,
boilers, machinery, Equipment, facilities, fixtures, supplies, fuel, and other
properties constituting a part of the Facility, (ii) free issue items used in
connection with the Facility, (iii) the inventory of spare parts to be included
in the Facility, (iv) property of others in the care, custody or control of
Contractor or Owner in connection with the Project, (v) all preliminary works,
temporary works and interconnection works, (vi) foundations and other property
below the surface of the ground, and (vii) electronic equipment and media.

 

(b)                                 Additional
Coverages:  The insurance policy
shall insure (i) the cost of preventive measures to reduce or prevent a loss
(sue & labor) in an amount not less than U.S.$10,000,000, (ii) operational
and performance testing for a period not less than ninety (90) Days, (iii)
inland transit with sub-limits sufficient to insure the largest single shipment
to or from the Site from anywhere within the United States of America, (iv)
expediting expenses (defined as extraordinary expenses incurred after an
insured loss to make temporary repairs and expedite the permanent repair of the
damaged property in excess of the delayed startup coverage even if such
expenses do not reduce the delayed startup loss) in an amount not less than U.S.$15,000,000,
(v) off-Site storage with sub-limits sufficient to insure the full replacement
value of any property or Equipment not stored on the Site, (vi) the removal of
debris with a sub-limit not less than twenty-five percent (25%) of the loss
amount, but subject to a maximum of U.S.$10,000,000 and (vii) pollution clean
up and removal for a sub-limit not less than U.S.$1,000,000.

 

(c)                                  Special Clauses:  The insurance policy shall
include (i) a seventy-two (72) hour flood/storm/earthquake clause, (ii)
unintentional errors and omissions clause, (iii) a 50/50 clause, (iv) a
requirement that the insurer pay losses within thirty (30) Days after receipt
of an acceptable proof or loss or partial proof of loss, (v) an other insurance
clause making this insurance primary over any other insurance, (vi) a clause
stating that the policy shall not be subject to cancellation by the insurer
except for non-payment of premium and (vii) an extension clause allowing the
policy period to be extended up to six (6) months with respect to physical loss
or damage without modification to the terms and conditions of the policy and a
pre-agreed upon premium.

 

(d)                                 Prohibited Exclusions:  The
insurance policy shall not contain any (i) coinsurance provisions, (ii)
exclusion for loss or damage resulting from freezing and mechanical breakdown,
(iii) exclusion for loss or damage covered under any guarantee or warranty
arising out of an insured peril, (iv) exclusion for resultant damage caused by
ordinary wear and tear, gradual deterioration, normal subsidence, settling,
cracking, expansion or contraction

 

O-4

 

and faulty workmanship, design or materials no more restrictive than
the LEG 3/96 or DE-5 exclusion.

 

(e)                                  Sum Insured:  The insurance policy shall (i)
be on a completed value form, with no periodic reporting requirements, (ii) insure
one hundred percent (100%) of the Facility’s insurable values, (iii) value
losses at replacement cost, without deduction for physical depreciation or
obsolesce including custom duties, Taxes and
fees and (iv) insure loss or damage from earth movement, flood and windstorm
without a sub-limit.

 

(f)                                    Deductible:  The insurance policy shall
have no deductible greater than U.S.$500,000 per occurrence; provided, however, for flood and named windstorm,  the deductible shall not be greater than two
percent (2%) of values at risk,  subject
to a minimum deductible of U.S.$1,000,000 and a maximum deductible of U.S.$2,000,000
for flood and windstorm.

 

(g)                                 Payment of Insurance Proceeds:  The
property damage proceeds under the builder’s risk policy shall be paid as follows
with respect to any one occurrence:

 

(i)                                     the first Five Million U.S. Dollars
(U.S.$5,000,000) of amounts paid under the builder’s risk insurance policy for
property damage shall be paid by the insurance carrier directly to Contractor,
which shall be used by Contractor in connection with the repair, replacement or
other necessary work in connection with the loss or damage to the Facility; and

 

(ii)                                  any amounts in excess of Five Million U.S.
Dollars (U.S.$5,000,000) for property damage shall (x) be paid by the insurance
carrier directly to the Collateral Agent, and Owner shall pay such insurance
proceeds to Contractor in accordance with Monthly Invoices submitted to Owner
for the completion by Contractor of repairs, replacement and other necessary
work in accordance with the restoration plan prepared by Contractor and
approved by Owner, the Administrative Agent, and the Independent Engineer and
(y), provided that the conditions set forth
in clause (x) have been satisfied, be paid by Owner to Contractor in accordance
with the following schedule: (a) for the first Five Million U.S. Dollars
(U.S.$5,000,000) of builder’s risk proceeds received by the Collateral
Agent,  Owner shall have five (5)
Business Days after the Collateral Agent’s receipt of such proceeds to pay
Contractor; (b) for the Forty Million U.S. Dollars (U.S.$40,000,000) in builder’s
risk proceeds received by the Collateral Agent in excess of the amounts
referred to in clause (a) above, Owner shall have fifteen (15) Business Days
after the Collateral Agent’s receipt of such proceeds to pay Contractor; and
(c) and for any builder’s risk proceeds received by the Collateral Agent in excess
of the amounts referred to

 

O-5

 

in clause (b), Owner shall have
thirty (30) Business Days after the Collateral Agent’s receipt of such proceeds
to pay Contractor.   Notwithstanding the
foregoing, under no circumstances shall Owner be required to pay any builder’s
risk insurance proceeds to Contractor if Owner or Lender elects not to repair
or rebuild the Facility, except to the extent Contractor has incurred costs in
excess of the Five Million U.S. Dollars (U.S.$5,000,000) of builder’s risk
proceeds paid directly to Contractor for safety, protection and salvage.  For the avoidance of doubt, if there
is a delay in the approval of the restoration plan beyond the times specified
in Section 1A.9(g)(ii)(y) (a), (b) or (c) through no fault of Contractor, and
Contractor satisfies all other conditions in Section 1A.9(g)(ii) for the
payment of builder’s risk proceeds received by the Collateral Agent, then
Contractor shall be entitled to relief to the extent permitted under Section
6.2A.7 of the Agreement.

 

10.                                 Builder’s Risk Delayed Startup Insurance.  Delayed
startup coverage insuring Owner and Lender, as their interests may appear,
covering the Owner’s fixed costs and debt service as a result of any loss or
damage insured by Section 1A.9 above resulting in a delay in Substantial Completion
of the Facility beyond its anticipated date of Substantial Completion in an
amount equal to eighteen (18) months (or longer period of time, as determined
by Owner after receiving the results of the probable maximum loss report) projected
fixed costs plus debt service of Owner.  This
coverage shall be on an actual loss-sustained basis.  Any proceeds from delay in startup insurance
shall be payable solely to the Lender or its designee and shall not in any way
reduce or relieve Contractor of any of its obligation or liabilities under the
Agreement.

 

Such insurance shall (a) have a deductible of not
greater than sixty (60) Days aggregate for all occurrences during the builder’s
risk policy period, (b) include an interim payments clause allowing for the
monthly payment of a claim pending final determination of the full claim
amount, (c) cover loss sustained when access to the Site is prevented due to an
insured peril at premises in the vicinity of the Site for a period not less
than sixty (60) Days, (d) cover loss sustained due to the action of a public
authority preventing access to the Site due to imminent or actual loss or
destruction arising from an insured peril at premises in the vicinity of the
Site for a period not less than sixty (60) Days, (e) insure loss caused by FLEXA
named perils to finished Equipment (including machinery) while awaiting
shipment at the premises of a Subcontractor or Sub-subcontractor, (f) not
contain any form of a coinsurance provision or include a waiver of such
provision, (g) cover loss sustained due to the accidental interruption or
failure, caused by an insured peril, of supplies of electricity, gas, sewers,
water or telecommunication up to the terminal point of the utility supplier
with the Site for a period not less than sixty (60) Days, (h) covering delays
resulting from any item of Construction Equipment who loss or damage could
result in a delay in Substantial Completion of the Facility beyond the
deductible period of the delayed startup insurance, and (i) an extension clause
allowing the policy period to be extended up to six (6) months without
modification to the terms and conditions (other than the deductible) of the
policy and a pre-agreed premium.

 

O-6

 

11.                                 Marine
Cargo Insurance.  Cargo insurance
insuring Contractor, Owner and Lender, as their interests may appear, on a “warehouse
to warehouse” basis including land, air and marine transit insuring “all risks”
of loss or damage on a C.I.F. basis plus ten percent (10%) from the time the
goods are in the process of being loaded for transit until they are finally
delivered to the Site including shipment deviation, delay, forced discharge,
re-shipment and transshipment.  Such
insurance shall (a) include coverage for war, strikes, theft, pilferage,
non-delivery, charges of general average sacrifice or contribution, salvage
expenses, temporary storage in route, consolidation, repackaging, refused and
returned shipments, debris removal, (b) contain a replacement by air extension
clause, a 50/50 clause, a difference in conditions for C.I.F. shipments, an
errors and omissions clause, an import duty clause and a non-vitiation clause
(but subject to a paramount warranty for surveys of critical items), (c)
contain no exclusion for inadequate packing, (d) provide coverage for sue and
labor in an amount not less than $1,000,000 and (e) insure for the replacement
value of the largest single shipment on a C.I.F. basis plus ten percent (10%).

 

The
property damage proceeds under the marine cargo policy shall be paid as follows
with respect to any one occurrence:

 

(i)                                     the first Five Million U.S. Dollars
(U.S.$5,000,000) of amounts paid under the marine cargo insurance policy for
property damage shall be paid by the insurance carrier directly to Contractor,
which shall be used by Contractor in connection with the repair, replacement or
other necessary work in connection with the Facility; and

 

(ii)                                  any amounts in excess of Five Million U.S.
Dollars (U.S.$5,000,000) for property damage shall (x) be paid by the insurance
carrier directly to the Collateral Agent, and Owner shall pay such insurance
proceeds to Contractor in accordance with Monthly Invoices submitted to Owner
for the completion by Contractor of repairs, replacement and other necessary
work in accordance with the restoration plan prepared by Contractor and
approved by Owner, the Administrative Agent, and the Independent Engineer and
(y), provided that the conditions set forth
in clause (x) have been satisfied, be paid by Owner to Contractor in accordance
with the following schedule: (a) for the first Five Million U.S. Dollars
(U.S.$5,000,000) of marine cargo proceeds received by the Collateral
Agent,  Owner shall have five (5)
Business Days after the Collateral Agent’s receipt of such proceeds to pay
Contractor; (b) for the Forty Million U.S. Dollars (U.S.$40,000,000) in marine
cargo proceeds received by the Collateral Agent in excess of the amounts
referred to in clause (a) above, Owner shall have fifteen (15) Business Days
after the Collateral Agent’s receipt of such proceeds to pay Contractor; and
(c) and for any marine cargo proceeds received by the Collateral Agent in
excess of the amounts referred to in clause (b), Owner shall have thirty (30)
Business Days after the Collateral Agent’s receipt of such proceeds to pay
Contractor.   Notwithstanding the
foregoing, under no circumstances shall Owner be required to pay any marine
cargo insurance proceeds to Contractor if Owner or Lender elects not to repair
or rebuild the Facility, except to the extent

 

O-7

 

Contractor has incurred costs in excess of the Five Million U.S.
Dollars (U.S.$5,000,000) of marine cargo proceeds paid directly to Contractor
for safety, protection and salvage.  For
the avoidance of doubt, if there is a delay in the approval of the restoration
plan beyond the times specified in this Section 1A.11(ii)(y) (a), (b) or (c)
through no fault of Contractor, and Contractor satisfies all other conditions
in Section 1A.11(ii) for the payment of marine cargo proceeds received by the
Collateral Agent, then Contractor shall be entitled to relief to the extent
permitted under Section 6.2A.7 of the Agreement.

 

12.                                 Marine Cargo Delayed Startup Insurance.  Delayed
startup insurance insuring Owner and Lender, as their interest may appear, for
the Owner’s fixed costs, including debt service, due to a delay in achievement
of Substantial Completion of the Project arising out of an event insured by the
marine cargo insurance.  Such insurance
shall (a) cover loss sustained when ingress to or egress from the Site is
prevented, (b) include an interim payments clause allowing for the monthly
payment of a claim pending final determination of the full claim amount and (c)
loss, breakdown or damage to the hull, machinery or equipment of the vessel or
aircraft on which the insured property is being transported, resulting in a
delay in achievement of Substantial Completion of the Facility beyond its anticipated
date of Substantial Completion in an amount to be determined by Owner and
Lender but subject to commercial availability at a reasonable cost.  Such insurance shall have a deductible of not
greater than sixty (60) Days aggregate for all occurrences during the policy
period.  Any proceeds from delay in
startup insurance shall be payable solely to Lender or its designee and shall
not in any way reduce or relieve Contractor of any of its obligation or
liabilities under the Agreement.

 

13.                                 Marine
Terminal Liability Operations Insurance.  This policy shall provide coverage
against claims arising out of operations including products and completed
operations hazard and independent contractors for all sums which Contractor or
Owner shall become obligated to pay by reason of bodily injury or property
damage as a result of loss, damage, injury or expense (including expenses for
removal of the spill of a pollutant) and including loss of use, to any vessel
and its equipment, cargo, freight or other interests onboard, the property of
others, including the cost of or expense for the removal of wreck or debris of such
property, while docking, undocking, or while in Contractor’s or Owner’s custody
or possession as landing owners or operators at the locations scheduled or
while proceeding to or from such premises or caused directly or indirectly by
the freeing or breaking away from such premises.  The limit for such insurance shall be set a
level that is reasonably acceptable to Contractor, Owner and Lender and
sufficient to cover the maximum probable loss to the LNG tanker and its
contents.

 

14.                                 Charter’s
Legal Liability Insurance.  Charter’s
legal liability policy insuring Contractor and Owner Group for their legal
liabilities to third parties arising out of negligence and for which Contractor
or Owner Group is held responsible for the actions of any Subcontractor or
Sub-subcontractor while using a watercraft (including time, voyage and bare
boat charters) in connection with the Project.

 

O-8

 

Minimum limits:          U.S.$100,000,000
per occurrence

Maximum deductible:  U.S.$25,000 per occurrence

 

B.                                     Time
for Procuring and Maintaining Insurance. 
Contractor shall procure no later than LNTP the coverages specified in
Sections 1A.1, 1A.2, 1A.3 and 1A.4 (except only U.S.$10,000,000 in minimum
limits is required for each occurrence and aggregate from LNTP for the
coverages under Section 1A.4). 
Contractor shall procure no later than NTP the coverages specified in
Sections 1A.4 (having the minimum limits of U.S.$100,000,000 for each
occurrence and aggregate), 1A.5, 1A.6, 1A.7, 1A.8, 1A.9, 1A.10, 1A.11, 1A.12
and 1A.14.   Contractor shall procure the
coverage specified in Section 1A.13 no later than three (3) months prior to
arrival of the first LNG tanker. 
Contractor shall maintain in full force and effect at all times
commencing from such dates through Substantial Completion for all coverages
under this Attachment O (except in the case of products and completed
operations coverage under Section 1A.2 and 1A.4, which shall be maintained in
full force and effect for a further period of five (5) years).

 

C.                                     Combination
of Insurance Coverages.  Contractor
may combine any one or more of the insurance coverages specified in Sections
1A.4, 1A.7 and 1A.13 into one (1) policy, provided that the
coverage provided by such combined policy shall meet the requirements of
Sections 1A.4, 1A.7 and 1A.13 and shall not provide less coverage than that which
would have been provided had the insurances been procured separately under Sections
1A.4, 1A.7 and 1A.13.  Contractor may
also arrange separate/stand-alone policies of insurance for any of the
insurances required to the extent it is economical to do so and still provides
the required level of insurance.  For
example, it may be required to place pollution insurance on a stand-alone basis
or some of the coverage for flood and windstorm risk may also need to be placed
on a stand-alone basis.

 

D.                                    Insurance
Companies.  All insurance required to
be obtained by Contractor pursuant to this Agreement shall be from an insurer
or insurers permitted to conduct business as required by Applicable Law and
shall be rated with either an “A-: IX” or better by Best’s Insurance Guide
Ratings or “A-” or better by Standard and Poor’s.

 

E.                                      Subcontractor’s
and Sub-subcontractor’s Insurance Requirements.  Contractor shall ensure that each
Subcontractor and Sub-subcontractor shall either be covered by the insurance
provided by Contractor pursuant to this Agreement, or by insurance procured by
a Subcontractor or Sub-subcontractor. 
Should a Subcontractor or Sub-subcontractor be responsible for procuring
its own insurance coverage, Contractor shall ensure that each such
Subcontractor or Sub-subcontractor shall procure and maintain insurance to the
full extent required of Contractor under this Agreement and shall be required
to comply with all of the requirements imposed on Contractor with respect to
such Contractor-provided insurance on the same terms as Contractor, except that
Contractor shall have the sole responsibility for determining the limits of
coverage required to be obtained by such Subcontractors or Sub-subcontractors
in accordance with reasonably prudent business practices.  Subject to Section 7.1B of the Agreement, all
such insurance shall be provided for at the sole cost of Contractor or its
Subcontractors or Sub-subcontractors.  Failure
of Subcontractors or Sub-subcontractors to procure and maintain such insurance
coverage shall not relieve Contractor of its responsibilities under the
Agreement.

 

O-9

 

F.                                      Named
and Additional Insured.

 

1.                                       The
following insurance policies provided by Contractor shall include Owner Group as
Additional Insureds: employer’s liability, commercial automobile, aircraft
liability, hull and machinery, and protection and indemnity insurance.

 

2.                                       The
following insurance policies provided by Contractor shall include Owner Group
as Named Insureds:  commercial general
liability, umbrella or excess liability, builder’s risk, builder’s risk delayed
startup, marine cargo, marine cargo delayed startup and marine terminal
liability operations, and charter’s legal liability insurance.

 

G.                                     Waiver
of Subrogation and Waiver of Claims.

 

1.                                       All
policies of insurance provided by Contractor or any of its Subcontractors or
Sub-subcontractors pursuant to this Agreement shall include clauses providing
that each underwriter shall waive its rights of recovery, under subrogation or
otherwise, against Owner Group.

 

2.                                       Contractor
waives any and all claims, damages, losses, costs, and expenses against Owner
Group to the extent such claims, damages, losses, costs and expenses have
already been paid by the insurance procured by Contractor pursuant to the
Agreement.

 

H.                                    Contractor’s
Insurance is Primary.  The insurance
policies of Contractor and its Subcontractors and Sub-subcontractors shall
state that such coverage is primary and non-contributory to any other insurance
or self-insurance available to or provided by the Owner Group.

 

I.                                         Severability.  All
policies (other than in respect to worker’s compensation insurance) shall
insure the interests of the Owner Group regardless of any breach or violation
by Contractor or any other Party of warranties, declarations or conditions
contained in such policies, any action or inaction of Owner or others, or any
foreclosure relating to the Project or any change in ownership of all or any
portion of the Project.

 

J.                                        Copy
of Policy.  At Owner’s request,
Contractor shall promptly provide Owner certified copies of each of the
insurance policies of Contractor, or if the policies have not yet been received
by Contractor, then with binders of insurance, duly executed by the insurance
agent, broker or underwriter fully describing the insurance coverages effected.

 

K.                                    Limitation
of Liability.  Types and limits of
insurance shall not in any way limit any of Contractor’s obligations,
responsibilities or liabilities under this Agreement.

 

L.                                      Jurisdiction.  All insurance policies shall include coverage
for jurisdiction within the United States of America or other applicable
jurisdiction.

 

M.                                 Miscellaneous.  Contractor and its Subcontractors and
Sub-subcontractors shall do nothing to void or make voidable any of the
insurance policies purchased and maintained by

 

O-10

 

Contractor or its
Subcontractors or Sub-subcontractors hereunder. 
Contractor shall promptly give Owner and Lender notice in writing of the
occurrence of any casualty, claim, event, circumstance, or occurrence that may
give rise to a claim under an insurance policy hereunder and arising out of or
relating to the performance of the Work. 
In addition, Contractor shall ensure that Owner is kept fully informed
of any subsequent action and developments concerning the same, and assist in
the investigation of any such casualty, claim, event, circumstance or occurrence.

 

N.                                    Instructions
for Certificate of Insurance. 
Contractor’s certificate of insurance form, completed by Contractor’s
insurance agent, broker or underwriter, shall reflect all of the insurance
required by Contractor, the recognition of additional insured status, waivers
of subrogation, and primary/non-contributory insurance requirements contained
in this Attachment O and elsewhere in the Agreement.

 

O.                                    Certificate
of Insurance Requirements.  Prior to
the commencement of any Work under this Agreement and in accordance with
Section 1B of this Attachment O, Contractor shall deliver to Owner
certificates of insurance reflecting all of the insurance required of
Contractor under this Agreement.  All
certificates of insurance and associated notices and correspondence concerning
such insurance shall be addressed to the contact information listed in the
Agreement for notices, plus the following: Sabine Pass LNG, L.P., 717 Texas
Avenue, Suite 3100, Houston, Texas 77002, Facsimile: (713) 659-5459, Attn: Don
Turkleson.

 

In addition, each such
certificate of insurance for employer’s liability, commercial liability,
aircraft, hull and machinery, and protection and indemnity insurance shall
include the following language:

 

“Additional Insured:  Sabine Pass LNG, L.P., Lender and each of
their respective subsidiaries, affiliates, partners, co-venturers, agents,
officers, directors and employees named as Additional Insureds on employer’s
liability, commercial liability, aircraft, hull and machinery, and protection
and indemnity insurance.  The coverage
afforded the Additional Insured under these policies shall be primary
insurance.  If the Additional Insured has
other insurance which is applicable to a loss or claim, such other insurance
shall be on an excess or contingent basis.”

 

“Waiver of Subrogation in
favor of Additional Insureds as respects all policies required hereunder.”

 

In addition, each such
certificate of insurance for commercial general liability, umbrella excess
liability, builder’s risk, builder’s risk delayed start up, marine cargo,
marine cargo delayed start up, marine terminal liability operations and charter’s
legal liability insurance shall include the following language:

 

“Named Insured:  Sabine Pass LNG, L.P., Lender and each of
their respective subsidiaries, affiliates, partners, co-venturers, agents,
officers, directors and employees as Named Insureds on commercial general
liability, umbrella excess liability, builder’s risk, builder’s risk delayed
start up, marine cargo, marine cargo delayed start up, marine terminal
liability operations insurance and charter’s legal liability insurance.  The coverage afforded the

 

O-11

 

Named Insured under these
policies shall be primary insurance.  If
the Named Insured has other insurance which is applicable to a loss or claim,
such other insurance shall be on an excess or contingent basis.”

 

“Waiver of Subrogation in
favor of Named Insureds as respects all policies required hereunder.”

 

P.                                      Acceptable Policy Terms and Conditions:  All
policies of insurance required to be maintained by Contractor shall be written
on reasonable and customary policy forms with conditions and exclusions
consistent with insurance written for facilities of similar size and scope as
the Facility.

 

Q.                                    Deductibles.  Contractor and Owner shall bear the cost of
deductibles under the insurance provided by Contractor pursuant to this Attachment
O in accordance with the allocation of risk found elsewhere in this
Agreement.

 

2.                                       Policy Cancellation and Change:  All
policies of insurance required to be maintained pursuant to this Attachment
O shall be endorsed so that if at any time they are canceled, or their
coverage is reduced (by any party including the insured) so as to affect the
interests of Owner or Lender, such cancellation or reduction shall not be
effective as to Owner or Lender for sixty (60) Days after receipt by Owner and
Lender of written notice from such insurer of such cancellation or reduction, provided that (i) cancellation or reduction for marine cargo
war risk shall not be effective for seven (7) Days after receipt by Owner and
Lender of written notice from such insurer of such cancellation or reduction
and (ii) for non-payment of premium, cancellation or reduction shall not be
effective for ten (10) Days after receipt by Owner and Lender of written notice
from such insurer of such cancellation or reduction.

 

3.                                       Reports:  Contractor will advise Owner
and Lender in writing promptly of (1) any material changes in the coverage or
limits provided under any policy required by this Attachment O and (2)
any default in the payment of any premium and of any other act or omission on
the part of Contractor which may invalidate or render unenforceable, in whole
or in part, any insurance being maintained by the Contractor pursuant to this Attachment
O.

 

4.                                       Control of Loss:  If commercially feasible, all
policies of insurance required to be maintained pursuant to this Attachment
O, wherein more than one insurer provides the coverage on any single policy,
shall have a clause (or a separate agreement among the insurers) wherein all
insurers have agreed that the lead insurers shall have full settlement
authority on behalf of the other insurers.

 

5.                                       Loss Survey:  All policies of insurance
required to be maintained pursuant to this Attachment O, wherein more
than one insurer provides the coverage on any single policy, shall have a clause
(or a separate agreement among the insurers) wherein all insurers have agreed
upon the employment of a single firm to survey and investigate all losses on
behalf of the insurers.

 

6.                                       Miscellaneous
Policy Provisions:  All insurance
policies providing builder’s risk, builder’s risk delayed startup, marine cargo
or marine cargo delayed startup (i) shall not include any annual or term
aggregate limits of liability except for the perils of flood, earth movement
and windstorm, (ii) shall have any aggregate limits of liability apply
separately with respect to the Project, (iii)

 

O-12

 

shall have aggregate
limits for flood, earth movement and windstorm that apply annually and (iv) if
commercially feasible, shall not include a clause requiring the payment of
additional premium to reinstate the limits after loss except for insurance
covering the perils of flood, earth movement and windstorm.

 

7.                                       Lender
Requirements:  Contractor agrees to
cooperate with Owner and as to any changes in or additions to the foregoing
insurance provisions made necessary by requirements imposed by Lender
(including additional insured status, notice of cancellation, certificates of
insurance), provided that any resulting costs of
increased coverage shall be reimbursable by Owner and provided further that no
such requirements shall materially adversely affect Contractor’s risk exposure.  All policies of insurance required to be
maintained pursuant to this Attachment O shall contain terms and
conditions reasonably acceptable to Owner after consultation with Lender.

 

O-13

 

ATTACHMENT P

 

CONTRACTOR PERMITS

 

Contractor shall be responsible for obtaining all of the following
Permits and any and all other Permits not listed below but required for the
performance of the Work, except for the Owner Permits set forth in Attachment
Q.

 

	
  PERMIT OR

  APPROVAL

  	
   

  	
  REGULATORY

  REFERENCE

  	
   

  	
  RESPONSIBLE

  AGENCY

  	
   

  	
  AGENCY
  CONTACT

  INFORMATION

  	
   

  	
  REGULATED

  ACTIVITY

  	
   

  	
  TECHNICAL
  INFORMATION

  NEEDED FOR APPLICATION

  	
   

  	
  DATE

  REQUIRED

  	
   

  	
  COMMENTS

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Notice of Proposed Construction or Alteration - FAA
  Form 7460-1

  	
   

  	
  14 CFR Part 77

  	
   

  	
  Federal Aviation Administration (FAA)

  	
   

  	
  Federal Aviation Administration, Southwest Regional
  Office - Air Traffic Airspace Branch, ASW-520, 2601 Meachan Blvd., Fort
  Worth, TX 76137-4298 Phone: (817) 222-5520

  	
   

  	
  Construction or use of tall structures including
  cranes

  	
   

  	
  Locations and dimensions of Tanks and any other
  significant structures

  	
   

  	
  30 Days prior to the erection of the obstruction that
  exceeds 200 feet

  	
   

  	
  An Obstruction Evaluation/Airport Airspace Analysis
  (OE/AAA) is required if the Facility will have structures greater than 200
  feet or will be located less than 20,000 ft from an airport. Although the
  Tanks are less than 200 feet tall, there are several public air strips in the
  vicinity; Therefore, it is advisable to notify FAA of the project so they can
  conduct an OE/AAA to determine if the Tanks will require any special marking
  or additional lighting.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Temporary emergency and non-emergency diesel powered
  electrical generators

  	
   

  	
   

  	
   

  	
  Louisiana Department of Environmental Quality (LDEQ)

  	
   

  	
   

  	
   

  	
  Operation and emissions of generator engine

  	
   

  	
  Engine emissions based on manufacturer’s data must
  not exceed LCEQ limits. Exhaust emission test must be performed within 60
  days of initial operation.

  	
   

  	
  As required to support Permit requirement

  	
   

  	
  Exhaust emission testing and reporting required with
  60 days of initial operation.

  

 

P-1

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Water Bottom Dredge Permit

  	
   

  	
  LAC 76:XIII.101

  	
   

  	
  Louisiana Department of Wildlife and Fisheries (LDWF)

  	
   

  	
  LDWF-Region V, 1213 N Lakeshore Dr., Lake Charles, LA
  70601

  Phone:(337) 491-2580

  	
   

  	
  Dredging of fill material, sand and gravel from
  state-owned water bottoms

  	
   

  	
   

  	
   

  	
  Prior to the mobilization of dredge equipment

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spill Prevention Plan

  	
   

  	
   

  	
   

  	
  LDWF

  	
   

  	
  Jim Hanifen, LDWF-Coastal Ecology Section, 2000 Quail
  Drive, Baton Rouge, LA 70898

  Phone:(225) 765-2379

  	
   

  	
  Storage of petroleum products in coastal tidal areas.

  	
   

  	
  LDWF can require that a plan to prevent spills from
  petroleum product storage tanks be submitted and approved. This is normally
  not required for small portable tanks used in construction work. However, the
  LDWF must be contacted to determine requirement for the specific Site and
  tank installation

  	
   

  	
  On or before mobilization at Site

  	
   

  	
  Contractor to determine if needed and inform Owner.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LDEQ hazardous waste stream notification

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
   

  	
   

  	
  Generation of any amount of hazardous waste on the
  Site.

  	
   

  	
  List of normal hazardous and class 1 wastes.

  	
   

  	
  Not anticipated

  	
   

  	
  If Owner has EPA ID number, Owner would provide
  notification to LDEQ.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fire Protection

  	
   

  	
   

  	
   

  	
  Johnsons Bayou Fire Department

  	
   

  	
  Johnsons Bayou Fire Department; 155 Berwick Road;
  Cameron, LA 70631 (337) 569-2119

  	
   

  	
  Fire protection and mutual aid agreements

  	
   

  	
   

  	
   

  	
  On or before mobilization of permitted structures are
  erected at the Site

  	
   

  	
  It is not anticipated that these Permits will be
  required. Those that may apply pertain to occupied structures such as
  trailers.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Air permit

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
   

  	
   

  	
  Concrete Batch Plant

  	
   

  	
   

  	
   

  	
  On or before mobilization of the batch plant to the
  Site

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Occupancy Permit

  	
   

  	
   

  	
   

  	
  Cameron Parish

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  On or before habitable structures are mobilized to
  the Site

  	
   

  	
   

  

 

P-2

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  General Construction Permit

  	
   

  	
   

  	
   

  	
  Cameron Parish Police Jury

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  As required to support permitted activities

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LPDES hydrostatic test wastewater discharge permit

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
  Permits Section, LDEQ Water Permit Division, 7290 Bluebonnet,
  Baton Rouge, LA 70810

  Phone:(225) 219-3110

  	
   

  	
  Discharge of hydrostatic test wastewater to surface
  waters

  	
   

  	
   

  	
   

  	
  Prior to discharge of hydrotest water

  	
   

  	
   

  

 

P-3

 

ATTACHMENT Q

 

OWNER PERMITS

 

Owner shall obtain the Owner Permits listed below.

 

	
  PERMIT OR

  APPROVAL

  	
   

  	
  REGULATORY

  REFERENCE

  	
   

  	
  RESPONSIBLE

  AGENCY

  	
   

  	
  AGENCY
  CONTACT

  INFORMATION

  	
   

  	
  REGULATED

  ACTIVITY

  	
   

  	
  TECHNICAL
  INFORMATION

  NEEDED FOR

  APPLICATION

  	
   

  	
  DATE

  REQUIRED

  	
   

  	
  COMMENTS

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  NGA Section 3 Application

  	
   

  	
   

  	
   

  	
  U.S. Federal Energy Regulatory Commission (FERC)

  	
   

  	
   

  	
   

  	
  LNG Facility

  	
   

  	
  Environmental Resource Reports 1-13 submitted with
  FERC filing Environmental Information Request #1 Environmental Information
  Request #2 Environmental Information Response #3

  	
   

  	
  NTP

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 10/404 jurisdictional determination

  	
   

  	
  33 CFR 320 to 330

  	
   

  	
  U.S. Army Corps of Engineers (USACOE)

  	
   

  	
  Bruce Bennet, U.S. Army Corps of Engineers, 2000 Fort
  Point Road, Galveston, TX 77550 Phone:(409) 766-6389

  	
   

  	
  Construction activities in lakes, streams, wetlands

  	
   

  	
  Consultation Request for jurisdictional determination
  Request for appeal to jurisdictional determination Revised wetland
  delineation report

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-1

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 10/404 Construction Permit

  	
   

  	
  33CFR 320 to 330

  	
   

  	
  U.S. Army Corps of Engineers (USACOE)

  	
   

  	
  Bruce Bennet, U.S. Army Corps of Engineers, 2000 Fort
  Point Road, Galveston, TX 77550 Phone:(409) 766-6389

  	
   

  	
  Construction activities in lakes, streams, wetlands

  	
   

  	
  •      Design drawings for structures and
  shoreline protection

  •      Description of overall project 

  •      Delineation of wetland areas Revised
  permit-includes construction dock

  •      Revised Block 22 and Step 10 of 16 pages
  

  •      Revised Aquatic Resources Mitigation
  Plan

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Clarification on Anchorage

  	
   

  	
  33CFR 320 to 330

  	
   

  	
  U.S. Army Corps of Engineers (USACOE)

  	
   

  	
  Bruce Bennet, U.S. Army Corps of Engineers, 2000 Fort
  Point Road, Galveston, TX 77550 Phone:(409) 766-6389

  	
   

  	
  Possible encroachment on designated Anchorage Area

  	
   

  	
  Description of Project area anchorage/consultation
  Request for concurrence

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Soil impacts coordination and seeding plan

  	
   

  	
   

  	
   

  	
  Natural Resources Conservation Service

  	
   

  	
  Charles Starkovich, Lake Charles Service Center, 1400
  Gertsner Memorial Dr., Lake Charles, LA 70601

  	
   

  	
   

  	
   

  	
  Consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-2

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EFH

  	
   

  	
  Magnuson/Stevens Act

  	
   

  	
  NOAA Fisheries

  	
   

  	
  NOAA Fisheries:Baton Rouge Field Office, Kelly
  Shotts, c/o Louisiana State University, Military Science Building, Room 266,
  Baton Rouge, LA 70803-7535, (225) 389-0508

  	
   

  	
   

  	
   

  	
  Consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Federal Endangered Species Consultation

  	
   

  	
  Magnuson/Stevens Act

  	
   

  	
  NOAA Fisheries

  	
   

  	
  NOAA Fisheries:Southeast Regional Office, Chuck
  Orvitz/ Eric Hawk, 9721 Executive Center Drive North, St. Petersburg, FL
  33702

  	
   

  	
   

  	
   

  	
  •      Consultation for Project 

  •      Dredged Material Placement Area Plan
  review

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dredged Material Placement Area Plan

  	
   

  	
  Magnuson/Stevens Act

  	
   

  	
  NOAA Fisheries

  	
   

  	
  NOAA Fisheries:Baton Rouge Field Office, Kelly
  Shotts, c/o Louisiana State University, Military Science Building, Room 266,
  Baton Rouge, LA 70803-7535, (225) 389-0508

  	
   

  	
   

  	
   

  	
  •      Consultation for EFH

  •      Consultation letter re: construction
  dock and Aquatic Resources Mitigation Plan

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-3

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Federal Endangered Species Consultation

  	
   

  	
  Section 7 of the Endangered Species Act (ESA)

  	
   

  	
  U.S. Fish and Wildlife Service

  	
   

  	
  Bridgett Firmin, USFWS, 646 Cajundome Blvd., Suite
  400, Lafayette, LA 70506 Phone:(337) 291-3100

  	
   

  	
  Impacts to listed threatened and endangered species

  	
   

  	
  Consult with NOAA Fisheries for EFH and offshore T/E
  potential impacts, and consult with USACOE for wetlands

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Radio License

  	
   

  	
   

  	
   

  	
  Federal Communications Commission

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Mobilization to Site

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tribal Groups Consultation

  	
   

  	
  Section 106 of the National Historic Preservation Act

  	
   

  	
  Bureau of Indian Affairs

  	
   

  	
  Tom Parry, 1302 East Central Blvd., Anadarko, OK
  73005

  	
   

  	
   

  	
   

  	
  Consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Construction within a floodplain

  	
   

  	
   

  	
   

  	
  Federal Emergency Management, Region VI

  	
   

  	
  David Heigel/Carlton Watts Federal Regional Center,
  800 North Loop 288 Denton, TX 76209

  	
   

  	
  Construction within a floodplain

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Navigation and Marine Safety issues associated with
  the LNG terminal ship traffic

  	
   

  	
   

  	
   

  	
  United States Coast Guard

  	
   

  	
  Caption Sharon Richey, USCG Commanding officer US Coast
  Guard Marine Safety Office 2875 Jimmy Johnson Blvd. Port Arthur, Tx 77640

  	
   

  	
  Navigation and Marine Safety issues associated with
  the LNG terminal ship traffic

  	
   

  	
  •      Consultation

  •      Disabled Ships simulation memo

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-4

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Source Review Preconstruction Permit (Prevention
  of Significant Deterioration and Non-Attainment Review)

  	
   

  	
  LAC 33:III.509

  	
   

  	
  Louisiana Department of Environmental Quality(LDEQ)

  	
   

  	
  Tegan Treadaway, LDEQ Air Permit Division, 7290
  Bluebonnet, Baton Rouge, LA 70810 Phone:(225) 219-3082

  	
   

  	
  Construction of major source of air pollution

  	
   

  	
  •      Air pollution emissions and control
  equipment data

  •      Locations and dimensions of major
  structures

  •      Air quality impact modeling

  •      BACT/LAER determinations

  •      Identification of emission offsets for
  non-attainment areas 

  •      Addendum to air permit, officially added
  turbines to application

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Non-attainment review for air permit

  	
   

  	
   

  	
   

  	
  Texas Commission on Environmental Quality, Air
  Permits Division

  	
   

  	
  Dale Beebe Farrow or James Red, P.O. Box 13087,
  Austin, TX 78711-3087

  	
   

  	
   

  	
   

  	
  Non-attainment review for air permit consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Surface Water Acquisition Permit (Greater than
  10-acre feet)

  	
   

  	
   

  	
   

  	
  Texas Commission on Environmental Quality

  	
   

  	
  Water Rights Permitting Group - Attn: Kellye Rila (MC
  160). 12100 Park 35 Circle, Austin Texas 78753

  	
   

  	
   

  	
   

  	
  Information on source and quantities of surface water
  to be acquired in Texas state waters for hydrostation test water

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Groundwater Certification as a part of the air permit
  approval process

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
  Environmental Technology Division, Travis Williams,
  Phone: (225) 219-3290

  	
   

  	
  Air Permit

  	
   

  	
  groundwater certification letter and package

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-5

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spill Prevention, Control and Countermeasure Plan
  (SPCC) for Operating Facility

  	
   

  	
  40 CFR Part 112

  	
   

  	
  LDEQ

  	
   

  	
   

  	
   

  	
  Onsite storage of oil in quantities greater than
  threshold amounts

  	
   

  	
  1. Oil storage inventory including maximum capacity

  2. Description of measures to prevent an oil spill

  3. Description of how personnel will respond to an oil spill

  	
   

  	
  Prior to RFCD

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RCRA Small Quantity Hazardous Waste Generator
  Identification Number

  	
   

  	
  40 CFR Part 261

  	
   

  	
  LDEQ

  	
   

  	
  Call DEQ, Jesse Chang 225-219-3071, or Tom Killeen
  225-219-3097 to find out where to send this or if it is required.

  	
   

  	
  Onsite presence of hazardous waste in quantities
  greater than threshold amounts

  	
   

  	
  Expected hazardous waste accumulation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
  Required if hazardous waste will exceed the 100
  kg/month threshold. Contractor to confirm quantity to determine if needed.
  Owner still gets generator ID number.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Water Quality Certification, Section 401 of CWA

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
  Larry Wiesepape, Ph.D., LDEQ Water Permit Division,
  7290 Bluebonnet, Baton Rouge, LA 70810 Phone:(225) 219-3016

  	
   

  	
  Triggered by application for a USACOE Section 404
  Permit

  	
   

  	
  •      Submitted as a part of the CUP and IP

  •      Consultation for modified construction
  dock area and Aquatic Resources Mitigation Plan

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LPDES sanitary wastewater discharge permit

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
  Permits SEction, LDEQ Water Permit Division, 7290
  Bluebonnet, Baton Rouge, LA 70810 Phone:(225) 219-3112

  	
   

  	
  Discharge of sanitary wastewater

  	
   

  	
  •      Water balance diagram

  •      Expected wastewater flows and
  characteristics

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-6

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LPDES Storm Water Multi-sector General Permit
  (combined facilities)/ industrial water discharge permit application form
  SCC-2

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
  Yvonne Wingate, LDEQ Water Permit Division, 7290
  Bluebonnet, Baton Rouge, LA 70810 Phone:(225) 219-3111

  	
   

  	
  Storm water runoff

  	
   

  	
  Must develop Storm Water Pollution Prevention Plan,
  including:- site description- pollution and erosion control measures-
  maintenance procedures

  	
   

  	
  Prior to RFCD

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LPDES Storm Water Construction Permit Notice of
  Intent

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
  Darlene Bernard, LDEQ Water Permit Division, 7290
  Bluebonnet, Baton Rouge, LA 70810 Phone:(225) 219-3112

  	
   

  	
  Storm water runoff

  	
   

  	
  Notice of Intent

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LPDES Storm Water Construction Permit Notice of
  Termination

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
  Darlene Bernard, LDEQ Water Permit Division, 7290
  Bluebonnet, Baton Rouge, LA 70810 Phone:(225) 219-3112

  	
   

  	
  Storm water runoff

  	
   

  	
  Notice of Termination

  	
   

  	
  Prior to RFCD

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dredged Material Placement Area Plan

  	
   

  	
   

  	
   

  	
  LDEQ

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Dredged Material Placement Area Plan review

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-7

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  State threatened and endangered species clearance

  	
   

  	
  NEPA/FERC

  	
   

  	
  Louisiana Department of Wildlife and Fisheries (LDWF)
  and U.S. Fish and Wildlife

  	
   

  	
  Fred Dunham, LDWF, 2000 Quail Drive, Baton Rouge, La.
  70808 Phone:(225) 765-2346

  	
   

  	
  Assessment of site habitation by listed (threatened
  or endangered) species

  	
   

  	
  •      Consultation 

  •      Dredged Material Placement Area Plan
  review

  •      Warmwater Fisheries Time of Year
  Restrictions

  •      Response from LDWF to CMD re: CUP
  P20040708

  •      Consultation for approval of revised
  construction dock

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Coastal Use Permit

  	
   

  	
   

  	
   

  	
  Louisiana Department of Natural Resources (LDNR)

  	
   

  	
  Rocky Hinds/Chris Davis, LDNR, 617 North Third
  Street, Baton Rouge, LA 70802-5428 Phone:(504) 342-7591

  	
   

  	
  Construction in coastal management zone

  	
   

  	
  •      Solicitation of Views

  •      Same as for USACOE permit, and
  additional information on CY of disturbance in all land types.

  •      Revised permit application, includes
  construction dock

  •      Revised Step 10 of 16 and Block 22

  •      Revised Aquatic Resources Mitigation
  Plan

  •      Summary report of subsurface
  investigation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-8

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Beneficial Use Plan for Dredge Material

  	
   

  	
   

  	
   

  	
  Louisiana Department of Natural Resources (LDNR)

  	
   

  	
  Rocky Hinds/Chris Davis, LDNR, 617 North Third
  Street, Baton Rouge, LA 70802-5428 Phone:(504) 342-7591

  	
   

  	
  Dredge Material Placement

  	
   

  	
  Dredged Material Placement Area Plan review

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Commercial Water Bottom Lease

  	
   

  	
   

  	
   

  	
  Louisiana State Land Office

  	
   

  	
  Synthia Marcelin, SLO, P.O. Box 44124, Baton Rouge,
  LA 70814-4124 Phone:(225) 342-0120

  	
   

  	
   

  	
   

  	
  A commercial water bottom lease for the proposed Project
  will be required, including the construction dock area.

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Historic Preservation Approval - Section 106
  Environmental Review (applies to entire site)

  	
   

  	
   

  	
   

  	
  Louisiana Division of Historic Preservation (LDHP)

  	
   

  	
  Pam Breaux- State Historic Preservation Officer
  (Rachel Watson/Duke Rivet-contact), Capital Annex Building1051 North Third
  Street, Baton Rouge, LA 70804, (225) 342-8170

  	
   

  	
  Federal oversight requires compliance with Section
  106

  	
   

  	
  •      Phase I Survey Report

  •      Unanticipated Discoveries Plan review

  •      Dredged Material Placement Area Plan review

  •      Updated Unanticipated Discoveries Plan

  •      Final Phase I Survey Report (terminal and pipeline combined) 

  •      Consultation for approval of revised construction dock

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Creole Nature Trail View shed

  	
   

  	
  NEPA

  	
   

  	
  Louisiana Department of Culture, Recreation and
  Tourism

  	
   

  	
  Chuck Morse, Capitol Annex Building, Rm. 1051, North
  3rd St., Baton Rouge, LA 70802, (225)-342-1896

  	
   

  	
   

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-9

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Traffic data for SH82

  	
   

  	
  NEPA/FERC

  	
   

  	
  Louisiana Department of Transportation and
  Development

  	
   

  	
  Steve Jiles, 5827 Hwy 90 East, Lake Charles, LA
  70615, 337-437-9105

  	
   

  	
   

  	
   

  	
  request for traffic information for SH 82

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Building Permit

  	
   

  	
   

  	
   

  	
  Cameron Parish

  	
   

  	
  Tina Horn, 110 Smith Circle, Cameron, LA 70631
  Phone:(337) 775-5718 (ext. 115)

  	
   

  	
  Design and installation of fire sprinkler and deluge
  systems

  	
   

  	
  •      Consultation

  •      Site plan and description of facility components

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Permit for Construction in a Zone “VE” or Variance
  as: functionality dependent use, Floodplain Development Permit

  	
   

  	
   

  	
   

  	
  Cameron Parish Floodplain Administrator

  	
   

  	
  Tina Horn/Tammy Trahan, 110 Smith Circle, Cameron, LA
  70631 Phone:(337) 775-5718 (ext. 115)

  	
   

  	
  Construction of facilities and buildings

  	
   

  	
  •      Submit Individual Permit application package

  •      Revised Permit application

  •      Revised Step 10 of 16 and Block 22

  •      Indemnification and Roadway Easement permits/approvals

  •      Revised Aquatic Resources Mitigation Plan

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Native American consultation

  	
   

  	
  NEPA, Section 106

  	
   

  	
  Caddo Nation

  	
   

  	
  Mr. Bobby Gonzales, Highway 152 and Highway281,
  Binger, OK 73009, 405-656-2344

  	
   

  	
   

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Native American consultation

  	
   

  	
  NEPA, Section 106

  	
   

  	
  Alabama-Coushatta Tribe of Texas

  	
   

  	
  Ms. Debbie Thomas, 571 State Park Road 56,
  936-563-1100

  	
   

  	
   

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-10

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Native American consultation

  	
   

  	
  NEPA, Section 106

  	
   

  	
  Coushatta Tribe of Louisiana

  	
   

  	
  Coushatta Tribal Council, 1940 CC Bell Road, Elton,
  LA 70532, 337-584-2261

  	
   

  	
   

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Native American consultation

  	
   

  	
  NEPA, Section 106

  	
   

  	
  Chitimaca Tribe of Louisiana

  	
   

  	
  Kimberly Waldon, Cultural Development, 105 Houma
  Drive, Charenton, LA 70523, (337)-923-9923

  	
   

  	
   

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Native American consultation

  	
   

  	
  NEPA, Section 106

  	
   

  	
  Jena Band of Choctaw

  	
   

  	
  Ms. Christine Norris, 14025 Highway 84 West, Trout,
  LA 7137, 318-992-2717

  	
   

  	
   

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Native American consultation

  	
   

  	
  NEPA, Section 106

  	
   

  	
  Tunica-Biloxi Tribe

  	
   

  	
  Mr. Earl Barby, 151 Melacon Dr., Marksville, LA
  71351, 318-253-9767

  	
   

  	
   

  	
   

  	
  consultation

  	
   

  	
  NTP or as specified in FERC Authorization

  	
   

  	
   

  

 

Q-11

 

ATTACHMENT R

 

FORM OF IRREVOCABLE, STANDBY LETTERS OF CREDIT

 

R-1

 

SCHEDULE R-1

 

FORM OF PERFORMANCE LETTER OF CREDIT

 

[to be issued on letterhead of Issuing Bank]

 

 

IRREVOCABLE
STANDBY LETTER OF CREDIT NO.                 

DATE:  [                                                         ]

AMOUNT
OF: U.S.$ [                                   ]

 

	
  BENEFICIARY:

  	
   

  	
  APPLICANT
  AND ACCOUNT PARTY:

  
	
   

  	
   

  	
   

  
	
  SABINE PASS LNG, L.P.

  	
   

  	
  BECHTEL
  CORPORATION

  
	
  717
  TEXAS AVENUE, SUITE 3100

  	
   

  	
  3000
  POST OAK BOULEVARD

  
	
  HOUSTON,
  TEXAS 77002

  	
   

  	
  HOUSTON,
  TEXAS 77056

  
	
  FACSIMILE:
  (713) 659-5459

  	
   

  	
  FACSIMILE:
  [                                       ]

  
	
  ATTN:
  [                                             ]

  	
   

  	
  ATTN:
  [                                                 ]

  

 

WE
HEREBY ISSUE OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO.                     
(THIS “LETTER OF CREDIT”) IN FAVOR
OF SABINE PASS LNG, L.P., AS BENEFICIARY, FOR AN INITIAL AMOUNT OF [                  ]
U.S. DOLLARS ($[                  ])
(THE “STATED AMOUNT”) AT THE
REQUEST AND FOR THE ACCOUNT OF BECHTEL CORPORATION, AS APPLICANT.

 

WE
ARE INFORMED THAT THIS LETTER OF CREDIT IS ISSUED ON BEHALF OF THE APPLICANT TO
SUPPORT APPLICANT’S OBLIGATIONS UNDER THAT CERTAIN LUMP SUM TURNKEY AGREEMENT
FOR THE ENGINEERING, PROCUREMENT AND CONSTRUCTION OF THE SABINE PASS LNG
RECEIVING, STORAGE AND REGASIFICATION TERMINAL, DATED AS OF DECEMBER 18, 2004, BY AND BETWEEN APPLICANT AND
BENEFICIARY (AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME
TO TIME, THE “AGREEMENT”).

 

FUNDS
UNDER THIS LETTER OF CREDIT ARE AVAILABLE BY PAYMENT AGAINST THE PRESENTATION
OF YOUR DRAFT(S) DRAWN AT SIGHT ON [INSERT ISSUING BANK’S
NAME AND ADDRESS] (THE “ISSUING BANK”)
IN SUBSTANTIALLY THE FORM OF ANNEX I ATTACHED HERETO AND ACCOMPANIED BY
A DRAWING CERTIFICATE DULY SIGNED IN SUBSTANTIALLY THE FORM OF ANNEX II
OR ANNEX VI ATTACHED HERETO APPROPRIATELY COMPLETED.

 

PARTIAL
DRAWINGS ARE PERMITTED.  ALL BANKING
CHARGES UNDER THIS LETTER OF CREDIT ARE FOR ACCOUNT OF THE APPLICANT.

 

THIS
LETTER OF CREDIT IS TRANSFERABLE IN ITS ENTIRETY AND NOT IN PART, UPON NOTICE
BY BENEFICIARY TO ISSUER HEREUNDER, SUBSTANTIALLY IN THE FORM OF ANNEX III
ATTACHED HERETO APPROPRIATELY COMPLETED; PROVIDED, HOWEVER, THAT THIS LETTER OF
CREDIT MAY NOT BE TRANSFERRED TO ANY PERSON IF SUCH TRANSFER TO, OR DRAWING
UNDER THIS LETTER OF CREDIT BY, SUCH PERSON WOULD BE PROHIBITED OR BLOCKED
UNDER ANY U.S. EXECUTIVE ORDER, LAW OR ANY RULE OR REGULATION OF THE OFFICE OF
FOREIGN ASSETS CONTROL OF THE U.S. TREASURY DEPARTMENT OR THE U.S. COMMERCE
DEPARTMENT, AND ANY ATTEMPTED TRANSFER WHICH VIOLATES THIS PROVISION SHALL BE
NULL AND VOID.

 

THE
STATED AMOUNT SHALL BE AUTOMATICALLY AND PERMANENTLY REDUCED BY THE AMOUNT OF
ANY DRAWING RECEIVED BY BENEFICIARY PURSUANT TO THIS LETTER OF CREDIT [INSERT
ENTIRE LETTER OF CREDIT REFERENCE, ALL NUMBERS AND LETTERS].

 

R-2

 

THE
STATED AMOUNT OF THIS LETTER OF CREDIT SHALL DECREASE TO AN AGGREGATE AMOUNT OF
[                  ]
U.S. DOLLARS ($[                  ])
THIRTY (30) DAYS AFTER ISSUING BANK’S RECEIPT FROM BENEFICIARY OF (A) A COPY OF
THE SUBSTANTIAL COMPLETION CERTIFICATE SIGNED BY APPLICANT AS CONTRACTOR AND
(B) A COPY OF THE SUBSTANTIAL COMPLETION CERTIFICATE SIGNED BY BENEFICIARY AS
OWNER SHOWING THAT BENEFICIARY ACCEPTS THE SUBSTANTIAL COMPLETION CERTIFICATE,
BOTH OF WHICH SHALL BE IN SUBSTANTIALLY THE FORM OF ANNEX IV ATTACHED
HERETO APPROPRIATELY COMPLETED.

 

ALL DEMANDS FOR PAYMENT
SHALL BE PRESENTED TO THE ISSUING BANK LOCATED AT [INSERT
ISSUING BANK’S NAME AND ADDRESS], NOT LATER THAN 5:00 P.M., CENTRAL
STANDARD TIME (“C.S.T.”).

 

THIS
LETTER OF CREDIT SHALL EXPIRE ON [                    ,] 200[  ]
BUT SUCH EXPIRATION DATE SHALL BE AUTOMATICALLY EXTENDED FOR A PERIOD OF ONE
YEAR ON [                ], 200[  ],
AND ON EACH SUCCESSIVE EXPIRATION DATE THEREAFTER, UNLESS (A) AT LEAST 120
CALENDAR DAYS BEFORE THE THEN CURRENT EXPIRATION DATE WE NOTIFY BOTH
BENEFICIARY AND APPLICANT, BY CERTIFIED MAIL, AT THEIR RESPECTIVE ADDRESSES SET
FORTH ABOVE, THAT WE HAVE DECIDED NOT TO EXTEND THIS LETTER OF CREDIT BEYOND
THE THEN CURRENT EXPIRATION DATE, OR (B) BEFORE THE THEN CURRENT EXPIRATION
DATE, BENEFICIARY PROVIDES WRITTEN NOTICE TO US IN SUBSTANTIALLY THE FORM OF ANNEX
V (I) OF THE EXPIRATION OF THE “DEFECT CORRECTION PERIOD” (AS DEFINED IN
THE AGREEMENT), OR (II) THAT THE TERM OF THE AGREEMENT HAS OTHERWISE
EXPIRED.  IN THE EVENT BENEFICIARY IS SO
NOTIFIED BY US PURSUANT TO CLAUSE (A) OF THE IMMEDIATELY PRECEDING SENTENCE,
ANY UNUSED PORTION OF THIS LETTER OF CREDIT SHALL BE IMMEDIATELY AVAILABLE FOR
PAYMENT TO BENEFICIARY UPON BENEFICIARY’S PRESENTMENT OF DRAFTS DRAWN AT SIGHT
IN SUBSTANTIALLY THE FORM OF ANNEX I AND ANNEX VI ATTACHED HERETO
APPROPRIATELY COMPLETED NO EARLIER THAN THIRTY (30) CALENDAR DAYS PRIOR TO THE
THEN CURRENT EXPIRATION DATE.

 

IF
WE RECEIVE YOUR DRAFT AND DRAWING CERTIFICATE IN FULL COMPLIANCE WITH THE TERMS
AND CONDITIONS OF THIS LETTER OF CREDIT AT OR BEFORE 11:00 A.M., C.S.T., ON A
BUSINESS DAY, WE WILL HONOR YOUR DEMAND FOR PAYMENT NO LATER THAN THE CLOSE OF
BUSINESS ON THE NEXT FOLLOWING BUSINESS DAY. 
IF WE RECEIVE YOUR DRAFT AND DRAWING CERTIFICATE IN FULL COMPLIANCE WITH
THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT AFTER 11:00 A.M., C.S.T., ON
A BUSINESS DAY, WE WILL HONOR YOUR DEMAND FOR PAYMENT NO LATER THAN THE CLOSE
OF BUSINESS ON THE SECOND BUSINESS DAY FOLLOWING SUCH RECEIPT.  “BUSINESS DAY”
MEANS ANY DAY OTHER THAN A SATURDAY, A SUNDAY OR ANY OTHER DAY COMMERCIAL BANKS
IN THE UNITED STATES OF AMERICA ARE AUTHORIZED OR REQUIRED TO BE CLOSED, AND A
DAY ON WHICH PAYMENTS CAN BE EFFECTED ON THE FEDWIRE SYSTEM.

 

IF
A DEMAND FOR PAYMENT MADE BY BENEFICIARY HEREUNDER DOES NOT, IN ANY INSTANCE,
CONFORM TO THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT, THE ISSUER SHALL
GIVE BENEFICIARY AND APPLICANT PROMPT NOTICE THAT THE DEMAND FOR PAYMENT WAS
NOT EFFECTED IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF
CREDIT, STATING THE REASONS THEREFORE AND THAT THE ISSUER WILL HOLD ANY
DOCUMENTS AT BENEFICIARY’S DISPOSAL OR UPON BENEFICIARY’S INSTRUCTIONS RETURN
THE SAME TO BENEFICIARY.  UPON BEING
NOTIFIED THAT THE DEMAND FOR PAYMENT WAS NOT EFFECTED IN CONFORMITY WITH THIS
LETTER OF CREDIT, BENEFICIARY MAY ATTEMPT TO CORRECT ANY SUCH NON-CONFORMING
DEMAND FOR PAYMENT.

 

R-3

 

WE
WILL PROMPTLY NOTIFY BENEFICIARY AND APPLICANT OF ANY NOTICE RECEIVED OR ACTION
FILED ALLEGING THE INSOLVENCY OR BANKRUPTCY OF THE ISSUING BANK, OR ALLEGING
ANY VIOLATIONS OF REGULATORY REQUIREMENTS WHICH COULD RESULT IN SUSPENSION OR
REVOCATION OF OUR CHARTER OR LICENSE TO DO BUSINESS.  IN THE EVENT WE BECOME UNABLE TO FULFILL OUR
OBLIGATIONS UNDER THIS LETTER OF CREDIT FOR ANY REASON, NOTICE SHALL BE GIVEN
IMMEDIATELY TO EACH OF YOU.

 

FOR
THE WRITTEN NOTICE SPECIFIED IN PARAGRAPH 2 OF ANNEX II, THE CONTENTS OF
SUCH NOTICE OR INVOICE, AS THE CASE MAY BE, SHALL NOT BE CONSIDERED AS A TERM
OF DRAWING.  THE ONLY PURPOSE FOR
PRESENTATION OF SUCH NOTICE OR INVOICE IS TO NOTE THE DATE ON SUCH NOTICE OR
INVOICE AND TO VERIFY THAT AT LEAST TEN (10) CALENDAR DAYS HAVE ELAPSED SINCE
ISSUANCE OF THE NOTICE OR RECEIPT OF THE INVOICE.

 

EXCEPT
AS OTHERWISE EXPRESSLY STATED HEREIN, THIS LETTER OF CREDIT IS ISSUED SUBJECT TO
THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION)
INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 500 (“U.C.P.”),
AND AS TO ANY MATTERS NOT SPECIFICALLY COVERED THEREBY, THIS LETTER OF CREDIT
SHALL BE GOVERNED BY THE LAWS OF TEXAS.

 

THIS
LETTER OF CREDIT SETS FORTH IN FULL THE TERMS OF OUR UNDERTAKING AND SUCH
UNDERTAKING SHALL NOT IN ANY WAY BE MODIFIED OR AMPLIFIED BY REFERENCE TO ANY
DOCUMENT, INSTRUMENT, OR AGREEMENT REFERRED TO HEREIN OTHER THAN THE U.C.P.

 

 

	
   

  	
  [NAME
  OF ISSUING U.S. BANK]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BY:

  	
   

  	
   

  
	
   

  	
  NAME:

  	
   

  	
   

  
	
   

  	
  TITLE:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BY:

  	
   

  	
   

  
	
   

  	
  NAME:

  	
   

  	
   

  
	
   

  	
  TITLE:

  	
   

  	
   

  
					

 

R-4

 

ANNEX I

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

DRAFT

 

 

                                  ,
20    

 

PAY
AT SIGHT TO ORDER OF OURSELVES                                                       
AND         /100 U.S. DOLLARS (U.S.$                            ).  THIS DRAFT IS PRESENTED UNDER IRREVOCABLE STANDBY
LETTER OF CREDIT NO.                           
DATED                                         ,
ISSUED FOR THE ACCOUNT OF BECHTEL CORPORATION.

 

 

TO:         [ISSUING BANK NAME]

[ISSUING BANK ADDRESS]

 

	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Sabine Pass LNG-LP,
  Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

R-5

 

ANNEX II

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

DRAWING CERTIFICATE

 

TO:                            [ISSUING BANK NAME]

[ISSUING BANK ADDRESS]

 

RE:                              IRREVOCABLE STANDBY LETTER OF CREDIT NO.

 

GENTLEMEN:

 

REFERENCE
IS MADE TO THAT CERTAIN IRREVOCABLE STANDBY LETTER OF CREDIT NO.                           
(THE “LETTER OF CREDIT”) ISSUED BY
YOU IN FAVOR OF SABINE PASS LNG, L.P. (“BENEFICIARY”).

 

IN
ACCORDANCE WITH THAT CERTAIN LUMP SUM TURNKEY AGREEMENT FOR THE ENGINEERING,
PROCUREMENT AND CONSTRUCTION OF THE SABINE PASS LNG RECEIVING, STORAGE AND
REGASIFICATION TERMINAL, DATED AS OF DECEMBER 18,  2004, BY AND BETWEEN BENEFICIARY AND BECHTEL
CORPORATION (“APPLICANT”) (AS AMENDED,
RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME, THE “AGREEMENT”), THE UNDERSIGNED, AN
OFFICER OF BENEFICIARY, DOES HEREBY CERTIFY THAT:

 

1.             APPLICANT OWES BENEFICIARY
LIQUIDATED DAMAGES IN ACCORDANCE WITH THE AGREEMENT, OR APPLICANT OWES
BENEFICIARY ANY OTHER LIABILITIES, DAMAGES, LOSSES, COSTS OR EXPENSES ARISING
OUT OF OR RELATING TO A BREACH OF ANY OBLIGATION UNDER THE AGREEMENT OR A
DEFAULT OR OTHERWISE; AND

 

2.             AT LEAST TEN (10) CALENDAR DAYS
PRIOR TO THE DATE OF THIS CERTIFICATE, EITHER: (A) BENEFICIARY HAS PROVIDED
WRITTEN NOTICE TO APPLICANT (A COPY OF WHICH IS ATTACHED) STATING BENEFICIARY’S
INTENT TO DRAW AGAINST THE LETTER OF CREDIT AND THE AMOUNT TO BE DRAWN AND
SPECIFYING THE GENERAL NATURE OF SUCH LIQUIDATED DAMAGES OR SUCH LIABILITIES, DAMAGES,
LOSSES, COSTS OR EXPENSES OWED TO BENEFICIARY FOR SUCH BREACH OR SUCH DEFAULT
OR OTHERWISE, OR (B) APPLICANT HAS RECEIVED FROM BENEFICIARY AN INVOICE (A COPY
OF WHICH IS ATTACHED) FOR LIQUIDATED DAMAGES OWED TO BENEFICIARY IN ACCORDANCE
WITH THE AGREEMENT AND APPLICANT HAS NOT PAID ALL OF SUCH INVOICED LIQUIDATED
DAMAGES WITHIN TEN (10) DAYS OF RECEIPT OF SUCH INVOICE; AND

 

3.             BENEFICIARY IS ENTITLED TO PAYMENT
OF U.S.$[                              ].

 

YOU
ARE REQUESTED TO REMIT PAYMENT OF THIS DRAWING IN IMMEDIATELY AVAILABLE FUNDS
BY WIRE TRANSFER TO THE FOLLOWING ACCOUNT:

 

[ACCOUNT INFORMATION]

 

IN
WITNESS WHEREOF, THE UNDERSIGNED HAS EXECUTED AND DELIVERED THIS CERTIFICATE AS
OF THIS               
DAY OF                                     ,
20      .

 

 

	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine Pass LNG-LP, Inc., its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

R-6

 

ANNEX III

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

FORM OF TRANSFER NOTICE

 

 

DATE:                             

TO:         [ISSUING BANK]

[ISSUING BANK ADDRESS]

 

 

RE:          IRREVOCABLE STANDBY LETTER OF CREDIT NO.                                       

 

 

GENTLEMEN:

 

FOR VALUE RECEIVED, THE
UNDERSIGNED BENEFICIARY HEREBY IRREVOCABLY TRANSFERS TO:

 

	
   

  
	
  NAME OF TRANSFEREE

  	
   

  
	
   

  
	
  ADDRESS

  	
   

  

 

	
   

  

ALL
RIGHTS OF THE UNDERSIGNED BENEFICIARY TO DRAW UNDER THE ABOVE LETTER OF CREDIT
IN ITS ENTIRETY.

 

BY THIS TRANSFER, ALL RIGHTS
OF THE UNDERSIGNED BENEFICIARY IN SUCH LETTER OF CREDIT ARE TRANSFERRED TO THE
TRANSFEREE AND THE TRANSFEREE SHALL HAVE THE SOLE RIGHTS AS BENEFICIARY
THEREOF, INCLUDING SOLE RIGHTS RELATING TO ANY AMENDMENTS WHETHER INCREASES OR
EXTENSIONS OR OTHER AMENDMENTS AND WHETHER NOW EXISTING OR HEREAFTER MADE. ALL
AMENDMENTS ARE TO BE ADVISED TO DIRECT TO THE TRANSFEREE WITHOUT NECESSITY OF
ANY CONSENT OF OR NOTICE TO THE UNDERSIGNED BENEFICIARY.

 

THE ORIGINAL OF SUCH LETTER
OF CREDIT IS RETURNED HEREWITH, AND WE ASK YOU TO ENDORSE THE TRANSFER ON THE
REVERSE HEREOF, AND FORWARD IT DIRECT TO THE TRANSFEREE WITH YOUR CUSTOMARY
NOTICE OF TRANSFER.

 

ENCLOSED IS REMITTANCE OF
U.S.$[          ]
VIA CERTIFIED CHECK IN PAYMENT OF YOUR TRANSFER COMMISSION AND IN ADDITION
THERETO WE AGREE TO PAY TO YOU ON DEMAND ANY EXPENSES WHICH MAY BE INCURRED BY
YOU IN CONNECTION WITH THIS TRANSFER.

 

	
   

  	
  SINCERELY,

  
	
   

  	
   

  
	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUTHORIZED NAME & TITLE

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUTHORIZED SIGNATURE

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TELEPHONE NUMBER

  

 

R-7

 

THE
ABOVE SIGNATURE, WITH TITLE AS STATED, CONFORMS WITH THAT ON FILE WITH US AND
IS AUTHORIZED FOR EXECUTION OF SUCH INSTRUMENTS.

 

	
   

  	
  NAME
  & ADDRESS OF BANK

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUTHORIZED
  NAME & TITLE

  	
   

  	
   

  
	
   

  	
  AUTHORIZED
  SIGNATURE

  	
   

  	
   

  
	
   

  	
  TELEPHONE
  NO.

  	
   

  	
   

  
							

 

 

THIS
FORM MUST BE EXECUTED IN DUPLICATE.

 

	
  (a)        FOR BANK USE ONLY

  
	
   

  
	
  Confirmation of
  Authenticating Bank’s signature performed by: 

  
	
   

  
	
   

  
	
  Date:

  	
   

  	
   

  	
  Time:

  	
   

  	
  a.m./p.m.

  
	
   

  
	
  Addl Info.:

  	
   

  
							

 

R-8

 

ANNEX IV

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

FORM OF
SUBSTANTIAL COMPLETION CERTIFICATE

 

Date:                                             

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Attention: Ed Lehotsky

 

Re:                               Substantial
Completion Certificate — Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Sabine Pass LNG Receiving, Storage and
Regasification Terminal, dated as of December 18, 2004 (the “Agreement”), by and between Sabine
Pass LNG, L.P. (“Owner”) and Bechtel
Corporation (“Contractor”)

 

Pursuant to Section 11.3
of the Agreement, Contractor hereby certifies that it has completed all
requirements under the Agreement for Substantial Completion with respect to the
Facility, including: (i) all Minimum Acceptance Criteria have been achieved;
(ii) all Performance Guarantees for the Facility have been achieved, or in the
case that all Performance Guarantees have not been achieved but all Minimum
Acceptance Criteria have been achieved, Contractor has paid Performance
Liquidated Damages in accordance with Section 20.3C (except such Performance
Liquidated Damages that are not due as a condition of Substantial Completion if
Contractor, at Owner’s election, is taking corrective actions under Section
11.5A(i)); (iii) any Substantial Completion Delay Liquidated Damages due and
owing have been paid in accordance with Section 20.3C; (iv) the Work (including
training, in accordance with Section 3.5 and the delivery of all documentation
required as a condition of Substantial Completion under this Agreement
(including documentation required for operation, including test reports)) has
been completed in accordance with the requirements of the Agreement other than
any Work which meets the definition of Punchlist; (v) Contractor hereby
delivers this Substantial Completion Certificate, as required pursuant to
Sections 11.3 of the Agreement; (vi) Contractor has obtained all Contactor
Permits for the Facility and (vii)  Contractor has, pursuant to Section
3.4, delivered to the Project all Operating Spare Parts required by the
Operating Spare Parts List to be delivered to the Project prior to Substantial
Completion.

 

To the extent Owner has
provided an invoice(s) for Liquidated Damages to Contractor pursuant to Section
20.3C of the Agreement, Contractor certifies that it has             
or has not                       
(check one) paid to Owner all such Liquidated Damages.

 

Contractor certifies that
it achieved all requirements under the Agreement for Substantial Completion on                               ,
200    , including the payment of Liquidated Damages owed
under the Agreement (if any), or if any such Liquidated Damages have not been
paid upon the date of this Substantial Completion Certificate, such Liquidated
Damages will be paid by Contractor within ten (10) Days after Contractor’s
receipt of Owner’s invoice for such Liquidated Damages.

 

Attached is all
information required to be provided by Contractor with this Certificate under
Section 11.3 of the Agreement, including the Performance Test report and
analysis and those requirements set forth in writing between the Parties for
the Performance Test Procedures.

 

[Signature
Page Follows]

 

R-9

 

IN WITNESS WHEREOF,
Contractor has caused this Substantial Completion Certificate to be duly
executed and delivered as of the date first written above.

 

	
   

  	
  BECHTEL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
						

 

cc:           Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Attn: General Counsel

 

R-10

 

Owner
Acceptance or Rejection of Substantial Completion Certificate

 

Pursuant
to Section 11.4B of the Agreement, Owner                  
accepts or                        
rejects (check one) the Substantial Completion Certificate.

 

If
Substantial Completion was achieved, Substantial Completion was achieved on                       ,
200      .

 

Acceptance
of Substantial Completion shall not relieve Contractor of any of Contractor’s
obligations to perform the Work in accordance with the requirements of the
Agreement, nor shall it in any way release Contractor or any surety of
Contractor from any obligations or liability pursuant to the Agreement,
including obligations with respect to unperformed obligations of the Agreement
or for any Work that does not conform to the requirements of this Agreement.

 

The
basis for any rejection of Substantial Completion is attached hereto.

 

 

	
   

  	
  For
  and on behalf of

  
	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Sabine Pass LNG-LP,
  Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
							

 

R-11

 

ANNEX V

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

FORM OF NOTICE FOR EXPIRATION OF DEFECT CORRECTION PERIOD

OR EXPIRATION OF TERM OF AGREEMENT

 

 

DATE:                                                        

 

TO:         [ISSUING BANK NAME]

[ISSUING BANK ADDRESS]

 

 

RE:          IRREVOCABLE STANDBY LETTER OF CREDIT NO.                         

 

 

GENTLEMEN:

 

REFERENCE
IS MADE TO THAT CERTAIN IRREVOCABLE STANDBY LETTER OF CREDIT NO.                           
(THE “LETTER OF CREDIT”) ISSUED BY
YOU IN FAVOR OF SABINE PASS LNG, L.P. (“BENEFICIARY”).

 

IN
ACCORDANCE WITH THE TERMS OF LETTER OF CREDIT, BENEFICIARY HEREBY NOTIFIES YOU
OF (A) THE EXPIRATION OF THE DEFECT CORRECTION PERIOD OR (B) THE EXPIRATION OF
THE TERM OF THE LUMP SUM TURNKEY AGREEMENT FOR THE ENGINEERING, PROCUREMENT AND
CONSTRUCTION OF THE SABINE PASS LNG RECEIVING,
STORAGE AND REGASIFICATION TERMINAL DATED AS OF DECEMBER 18, 2004, BY AND
BETWEEN BENEFICIARY AND BECHTEL CORPORATION (AS AMENDED, RESTATED, SUPPLEMENTED
OR OTHERWISE MODIFIED FROM TIME TO TIME).

 

THE
UNDERSIGNED HEREBY REQUESTS TERMINATION OF THIS LETTER OF CREDIT AND
CONFIRMATION TO APPLICANT OF SAID TERMINATION.

 

THE
LETTER OF CREDIT SHALL EXPIRE ON [                      ],
20[    ].

 

 

	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine Pass LNG-LP, Inc., its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

R-12

 

ANNEX VI

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

DRAWING CERTIFICATE

 

                                            ,
20      

TO:                            [ISSUING BANK NAME]

[ISSUING BANK ADDRESS]

 

RE:          IRREVOCABLE STANDBY LETTER OF CREDIT NO.                         

 

GENTLEMEN:

 

REFERENCE
IS MADE TO THAT CERTAIN IRREVOCABLE STANDBY LETTER OF CREDIT NO.                           
(THE “LETTER OF CREDIT”) ISSUED BY
YOU IN FAVOR OF SABINE PASS LNG, L.P. (“BENEFICIARY”).

 

IN
ACCORDANCE WITH THAT CERTAIN LUMP SUM TURNKEY AGREEMENT FOR THE ENGINEERING,
PROCUREMENT AND CONSTRUCTION OF THE SABINE PASS LNG RECEIVING, STORAGE AND
REGASIFICATION TERMINAL DATED AS OF DECEMBER 18, 2004, BY AND BETWEEN
BENEFICIARY AND BECHTEL CORPORATION (“APPLICANT”)
(AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME,
THE “AGREEMENT”), THE UNDERSIGNED, AN
OFFICER OF BENEFICIARY, DOES HEREBY CERTIFY THAT:

 

1.             BENEFICIARY HAS BEEN NOTIFIED THAT
YOU HAVE DECIDED NOT TO EXTEND THE LETTER OF CREDIT BEYOND THE CURRENT
EXPIRATION DATE;

 

2.             APPLICANT HAS NOT DELIVERED TO
BENEFICIARY A REPLACEMENT LETTER OF CREDIT SUBSTANTIALLY IDENTICAL TO THE
LETTER OF CREDIT (I.E., IRREVOCABLE STANDBY LETTER OF CREDIT NO.                     )
FROM A COMMERCIAL BANK IN THE UNITED STATES OF AMERICA RATED AT LEAST A- BY
STANDARD & POOR’S AND AT LEAST A3 BY MOODY’S INVESTORS SERVICES, AND THIRTY
(30) OR LESS CALENDAR DAYS REMAIN BEFORE THE EXPIRATION OF THE CURRENT
EXPIRATION DATE; AND

 

3.             BENEFICIARY IS ENTITLED TO PAYMENT
OF U.S.$[                              ].

 

YOU
ARE REQUESTED TO REMIT PAYMENT OF THIS DRAWING IN IMMEDIATELY AVAILABLE FUNDS
BY WIRE TRANSFER TO THE FOLLOWING ACCOUNT:

 

[ACCOUNT INFORMATION]

 

IN
WITNESS WHEREOF, THE UNDERSIGNED HAS EXECUTED AND DELIVERED THIS CERTIFICATE AS
OF THIS               
DAY OF                                     ,
20      .

 

 

	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine Pass LNG-LP, Inc., its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

R-13

 

SCHEDULE R-2

 

FORM OF PAYMENT
LETTER OF CREDIT

 

[to be issued on letterhead of Issuing Bank]

 

 

IRREVOCABLE
STANDBY LETTER OF CREDIT NO.                 

DATE:  [                                                       ]

AMOUNT
OF: U.S.$ [                                 ]

 

	
  BENEFICIARY:

  	
   

  	
  APPLICANT
  AND ACCOUNT PARTY:

  
	
   

  	
   

  	
   

  
	
  SABINE PASS LNG, L.P.

  	
   

  	
  BECHTEL
  CORPORATION

  
	
  717
  TEXAS AVENUE, SUITE 3100

  	
   

  	
  3000
  POST OAK BOULEVARD

  
	
  HOUSTON,
  TEXAS 77002

  	
   

  	
  HOUSTON,
  TEXAS 77056

  
	
  FACSIMILE:
  (713) 659-5459

  	
   

  	
  FACSIMILE:
  [                           ]

  
	
  ATTN:
  [                                            ]

  	
   

  	
  ATTN:
  [                                     ]

  

 

WE
HEREBY ISSUE OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO.                     
(THIS “LETTER OF CREDIT”) IN FAVOR
OF SABINE PASS LNG, L.P., AS BENEFICIARY, FOR AN INITIAL AMOUNT OF [                  ]
U.S. DOLLARS ($[                  ])
(THE “STATED AMOUNT”) AT THE
REQUEST AND FOR THE ACCOUNT OF BECHTEL CORPORATION, AS APPLICANT.

 

WE
ARE INFORMED THAT THIS LETTER OF CREDIT IS ISSUED ON BEHALF OF THE APPLICANT IN
CONSIDERATION OF AN ADVANCE PAYMENT PROVIDED BY BENEFICIARY AND TO SUPPORT
APPLICANT’S OBLIGATIONS UNDER THAT CERTAIN LUMP SUM TURNKEY AGREEMENT FOR THE
ENGINEERING, PROCUREMENT AND CONSTRUCTION OF THE SABINE PASS LNG RECEIVING,
STORAGE AND REGASIFICATION TERMINAL, DATED AS OF DECEMBER 18, 2004, BY AND
BETWEEN APPLICANT AND BENEFICIARY (AS AMENDED, RESTATED, SUPPLEMENTED OR
OTHERWISE MODIFIED FROM TIME TO TIME, THE “AGREEMENT”).

 

FUNDS
UNDER THIS LETTER OF CREDIT ARE AVAILABLE BY PAYMENT AGAINST THE PRESENTATION
OF YOUR DRAFT(S) DRAWN AT SIGHT ON [INSERT ISSUING BANK’S
NAME AND ADDRESS] (THE “ISSUING BANK”)
IN SUBSTANTIALLY THE FORM OF ANNEX I ATTACHED HERETO AND ACCOMPANIED BY
A DRAWING CERTIFICATE DULY SIGNED IN SUBSTANTIALLY THE FORM OF ANNEX II ATTACHED
HERETO APPROPRIATELY COMPLETED.

 

PARTIAL
DRAWINGS ARE PERMITTED.  ALL BANKING
CHARGES UNDER THIS LETTER OF CREDIT ARE FOR ACCOUNT OF THE APPLICANT.

 

THIS
LETTER OF CREDIT IS TRANSFERABLE IN ITS ENTIRETY AND NOT IN PART, UPON NOTICE
BY BENEFICIARY TO ISSUER HEREUNDER, SUBSTANTIALLY IN THE FORM OF ANNEX III
ATTACHED HERETO APPROPRIATELY COMPLETED; PROVIDED, HOWEVER, THAT THIS LETTER OF
CREDIT MAY NOT BE TRANSFERRED TO ANY PERSON IF SUCH TRANSFER TO, OR DRAWING
UNDER THIS LETTER OF CREDIT BY, SUCH PERSON WOULD BE PROHIBITED OR BLOCKED
UNDER ANY U.S. EXECUTIVE ORDER, LAW OR ANY RULE OR REGULATION OF THE OFFICE OF
FOREIGN ASSETS CONTROL OF THE U.S. TREASURY DEPARTMENT OR THE U.S. COMMERCE
DEPARTMENT, AND ANY ATTEMPTED TRANSFER WHICH VIOLATES THIS PROVISION SHALL BE
NULL AND VOID.

 

THE
STATED AMOUNT SHALL BE AUTOMATICALLY AND PERMANENTLY REDUCED BY THE AMOUNT OF
ANY DRAWING RECEIVED BY BENEFICIARY PURSUANT TO THIS LETTER OF

 

R-14

 

CREDIT
[INSERT ENTIRE LETTER OF CREDIT REFERENCE, ALL NUMBERS AND LETTERS].

 

THE
NOTICE TO PROCEED (“NTP”) WAS ISSUED ON [                    ,] 200[  ].  THE STATED AMOUNT OF THIS LETTER OF CREDIT
SHALL BE REDUCED TO ZERO, ON A PRO RATA BASIS, IN EQUAL MONTHLY AMOUNTS, IN
ACCORDANCE WITH THE FOLLOWING SCHEDULE:

 

	
  DATE

  	
   

  	
  MAXIMUM VALUE

  (U.S.$)

  	
   

  	
  % OF STATED

  AMOUNT

  	
   

  
	
  [INSERT
  DATE 30 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  91.67

  	
  %

  
	
  [INSERT
  DATE 61 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  83.33

  	
  %

  
	
  [INSERT
  DATE 91 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  75.00

  	
  %

  
	
  [INSERT
  DATE 122 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  66.67

  	
  %

  
	
  [INSERT
  DATE 152 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  58.33

  	
  %

  
	
  [INSERT
  DATE 183 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  50.00

  	
  %

  
	
  [INSERT
  DATE 213 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  41.67

  	
  %

  
	
  [INSERT
  DATE 243 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  33.33

  	
  %

  
	
  [INSERT
  DATE 273 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  25.00

  	
  %

  
	
  [INSERT
  DATE 304 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  16.67

  	
  %

  
	
  [INSERT
  DATE 334 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  8.33

  	
  %

  
	
  [INSERT
  DATE 365 DAYS FOLLOWING NTP]

  	
   

  	
  $

  	
   

  	
   

  	
  0.00

  	
  %

  

 

ALL DEMANDS FOR PAYMENT
SHALL BE PRESENTED TO THE ISSUING BANK LOCATED AT [INSERT
ISSUING BANK’S NAME AND ADDRESS], NOT LATER THAN 5:00 P.M., CENTRAL
STANDARD TIME (“C.S.T.”).

 

THIS
LETTER OF CREDIT SHALL EXPIRE ON [                    ,] 200[  ].

 

IF
WE RECEIVE YOUR DRAFT AND DRAWING CERTIFICATE IN FULL COMPLIANCE WITH THE TERMS
AND CONDITIONS OF THIS LETTER OF CREDIT AT OR BEFORE 11:00 A.M., C.S.T., ON A
BUSINESS DAY, WE WILL HONOR YOUR DEMAND FOR PAYMENT NO LATER THAN THE CLOSE OF
BUSINESS ON THE NEXT FOLLOWING BUSINESS DAY. 
IF WE RECEIVE YOUR DRAFT AND DRAWING CERTIFICATE IN FULL COMPLIANCE WITH
THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT AFTER 11:00 A.M., C.S.T., ON
A BUSINESS DAY, WE WILL HONOR YOUR DEMAND FOR PAYMENT NO LATER THAN THE CLOSE
OF BUSINESS ON THE SECOND BUSINESS DAY FOLLOWING SUCH RECEIPT.  “BUSINESS DAY”
MEANS ANY DAY OTHER THAN A SATURDAY, A SUNDAY OR ANY OTHER DAY COMMERCIAL BANKS
IN THE UNITED STATES OF AMERICA ARE AUTHORIZED OR REQUIRED TO BE CLOSED, AND A
DAY ON WHICH PAYMENTS CAN BE EFFECTED ON THE FEDWIRE SYSTEM.

 

IF
A DEMAND FOR PAYMENT MADE BY BENEFICIARY HEREUNDER DOES NOT, IN ANY INSTANCE,
CONFORM TO THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT, THE ISSUER SHALL
GIVE BENEFICIARY AND APPLICANT PROMPT NOTICE THAT THE DEMAND FOR PAYMENT WAS
NOT EFFECTED IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF
CREDIT, STATING THE REASONS THEREFORE AND THAT THE ISSUER WILL HOLD ANY
DOCUMENTS AT BENEFICIARY’S DISPOSAL OR UPON BENEFICIARY’S INSTRUCTIONS RETURN
THE SAME TO BENEFICIARY.  UPON BEING
NOTIFIED THAT THE DEMAND FOR PAYMENT WAS NOT EFFECTED IN CONFORMITY WITH THIS
LETTER OF CREDIT, BENEFICIARY MAY ATTEMPT TO CORRECT ANY SUCH NON-CONFORMING
DEMAND FOR PAYMENT.

 

WE
WILL PROMPTLY NOTIFY BENEFICIARY AND APPLICANT OF ANY NOTICE RECEIVED OR ACTION
FILED ALLEGING THE INSOLVENCY OR BANKRUPTCY OF THE ISSUING BANK, OR ALLEGING
ANY VIOLATIONS OF REGULATORY REQUIREMENTS WHICH COULD RESULT IN SUSPENSION OR
REVOCATION OF OUR CHARTER OR LICENSE TO DO BUSINESS.  IN THE EVENT

 

R-15

 

WE
BECOME UNABLE TO FULFILL OUR OBLIGATIONS UNDER THIS LETTER OF CREDIT FOR ANY
REASON, NOTICE SHALL BE GIVEN IMMEDIATELY TO EACH OF YOU.

 

FOR
THE WRITTEN NOTICE SPECIFIED IN PARAGRAPH 2 OF ANNEX II, THE CONTENTS OF
SUCH NOTICE OR INVOICE, AS THE CASE MAY BE, SHALL NOT BE CONSIDERED AS A TERM
OF DRAWING.  THE ONLY PURPOSE FOR
PRESENTATION OF SUCH NOTICE OR INVOICE IS TO NOTE THE DATE ON SUCH NOTICE OR
INVOICE AND TO VERIFY THAT AT LEAST TEN (10) CALENDAR DAYS HAVE ELAPSED SINCE ISSUANCE
OF THE NOTICE OR RECEIPT OF THE INVOICE.

 

EXCEPT
AS OTHERWISE EXPRESSLY STATED HEREIN, THIS LETTER OF CREDIT IS ISSUED SUBJECT
TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION)
INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 500 (“U.C.P.”),
AND AS TO ANY MATTERS NOT SPECIFICALLY COVERED THEREBY, THIS LETTER OF CREDIT
SHALL BE GOVERNED BY THE LAWS OF TEXAS.

 

THIS
LETTER OF CREDIT SETS FORTH IN FULL THE TERMS OF OUR UNDERTAKING AND SUCH
UNDERTAKING SHALL NOT IN ANY WAY BE MODIFIED OR AMPLIFIED BY REFERENCE TO ANY
DOCUMENT, INSTRUMENT, OR AGREEMENT REFERRED TO HEREIN OTHER THAN THE U.C.P.

 

 

	
   

  	
  [NAME
  OF ISSUING U.S. BANK]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BY:

  	
   

  	
   

  
	
   

  	
  NAME:

  	
   

  	
   

  
	
   

  	
  TITLE:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BY:

  	
   

  	
   

  
	
   

  	
  NAME:

  	
   

  	
   

  
	
   

  	
  TITLE:

  	
   

  	
   

  
					

 

R-16

 

ANNEX I

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

DRAFT

 

 

                                   ,
20     

 

PAY
AT SIGHT TO ORDER OF OURSELVES                                                       
AND         /100 U.S. DOLLARS (U.S.$                            ).  THIS DRAFT IS PRESENTED UNDER IRREVOCABLE STANDBY
LETTER OF CREDIT NO.                           
DATED                                         ,
ISSUED FOR THE ACCOUNT OF BECHTEL CORPORATION.

 

 

TO:         [ISSUING BANK NAME]

[ISSUING BANK ADDRESS]

 

 

 

	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine Pass LNG-LP, Inc., its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

R-17

 

ANNEX II

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

DRAWING CERTIFICATE

 

TO:         [ISSUING BANK NAME]

[ISSUING BANK ADDRESS]

 

RE:          IRREVOCABLE STANDBY LETTER OF CREDIT NO.                         

 

GENTLEMEN:

 

REFERENCE
IS MADE TO THAT CERTAIN IRREVOCABLE STANDBY LETTER OF CREDIT NO.                           
(THE “LETTER OF CREDIT”) ISSUED BY
YOU IN FAVOR OF SABINE PASS LNG, L.P. (“BENEFICIARY”).

 

IN
ACCORDANCE WITH THAT CERTAIN LUMP SUM TURNKEY AGREEMENT FOR THE ENGINEERING,
PROCUREMENT AND CONSTRUCTION OF THE SABINE PASS LNG RECEIVING, STORAGE AND
REGASIFICATION TERMINAL, DATED AS OF DECEMBER 18, 2004, BY AND BETWEEN
BENEFICIARY AND BECHTEL CORPORATION (“APPLICANT”)
(AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME,
THE “AGREEMENT”), THE UNDERSIGNED, AN
OFFICER OF BENEFICIARY, DOES HEREBY CERTIFY THAT:

 

1.             APPLICANT OWES BENEFICIARY ANY
LIABILITIES, DAMAGES, LOSSES, COSTS OR EXPENSES ARISING OUT OF OR RELATING TO A
BREACH OF ANY OBLIGATION UNDER THE AGREEMENT OR A DEFAULT OR OTHERWISE; AND

 

2.             AT LEAST TEN (10) CALENDAR DAYS
PRIOR TO THE DATE OF THIS CERTIFICATE, EITHER: BENEFICIARY HAS PROVIDED WRITTEN
NOTICE TO APPLICANT (A COPY OF WHICH IS ATTACHED) STATING BENEFICIARY’S INTENT
TO DRAW AGAINST THE LETTER OF CREDIT AND THE AMOUNT TO BE DRAWN AND SPECIFYING
THE GENERAL NATURE OF SUCH LIABILITIES, DAMAGES, LOSSES, COSTS OR EXPENSES OWED
TO BENEFICIARY FOR SUCH BREACH OR SUCH DEFAULT OR OTHERWISE; AND

 

3.             BENEFICIARY IS ENTITLED TO PAYMENT
OF U.S.$[                              ].

 

YOU
ARE REQUESTED TO REMIT PAYMENT OF THIS DRAWING IN IMMEDIATELY AVAILABLE FUNDS
BY WIRE TRANSFER TO THE FOLLOWING ACCOUNT:

 

[ACCOUNT INFORMATION]

 

IN
WITNESS WHEREOF, THE UNDERSIGNED HAS EXECUTED AND DELIVERED THIS CERTIFICATE AS
OF THIS               
DAY OF                                     ,
20      .

 

 

	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine Pass LNG-LP, Inc., its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

R-18

 

ANNEX III

 

IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER                     

 

FORM OF TRANSFER NOTICE

 

 

DATE:                                                 

TO:         [ISSUING BANK]

[ISSUING BANK ADDRESS]

 

 

RE:          IRREVOCABLE STANDBY LETTER OF CREDIT NO.                                       

 

 

GENTLEMEN:

 

FOR VALUE RECEIVED, THE
UNDERSIGNED BENEFICIARY HEREBY IRREVOCABLY TRANSFERS TO:

 

	
   

  
	
  NAME OF TRANSFEREE

  	
   

  
	
   

  
	
  ADDRESS

  	
   

  

 

	
   

  

ALL
RIGHTS OF THE UNDERSIGNED BENEFICIARY TO DRAW UNDER THE ABOVE LETTER OF CREDIT
IN ITS ENTIRETY.

 

BY THIS TRANSFER, ALL RIGHTS
OF THE UNDERSIGNED BENEFICIARY IN SUCH LETTER OF CREDIT ARE TRANSFERRED TO THE
TRANSFEREE AND THE TRANSFEREE SHALL HAVE THE SOLE RIGHTS AS BENEFICIARY
THEREOF, INCLUDING SOLE RIGHTS RELATING TO ANY AMENDMENTS WHETHER INCREASES OR
EXTENSIONS OR OTHER AMENDMENTS AND WHETHER NOW EXISTING OR HEREAFTER MADE. ALL
AMENDMENTS ARE TO BE ADVISED TO DIRECT TO THE TRANSFEREE WITHOUT NECESSITY OF
ANY CONSENT OF OR NOTICE TO THE UNDERSIGNED BENEFICIARY.

 

THE ORIGINAL OF SUCH LETTER
OF CREDIT IS RETURNED HEREWITH, AND WE ASK YOU TO ENDORSE THE TRANSFER ON THE
REVERSE HEREOF, AND FORWARD IT DIRECT TO THE TRANSFEREE WITH YOUR CUSTOMARY
NOTICE OF TRANSFER.

 

ENCLOSED IS REMITTANCE OF
U.S.$[          ]
VIA CERTIFIED CHECK IN PAYMENT OF YOUR TRANSFER COMMISSION AND IN ADDITION
THERETO WE AGREE TO PAY TO YOU ON DEMAND ANY EXPENSES WHICH MAY BE INCURRED BY
YOU IN CONNECTION WITH THIS TRANSFER.

 

	
   

  	
  SINCERELY,

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  NAME OF BENEFICIARY

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUTHORIZED NAME & TITLE

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUTHORIZED SIGNATURE

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TELEPHONE NUMBER

  

 

R-19

 

THE
ABOVE SIGNATURE, WITH TITLE AS STATED, CONFORMS WITH THAT ON FILE WITH US AND
IS AUTHORIZED FOR EXECUTION OF SUCH INSTRUMENTS.

 

 

	
   

  	
  NAME
  & ADDRESS OF BANK

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUTHORIZED
  NAME & TITLE

  	
   

  	
   

  
	
   

  	
  AUTHORIZED
  SIGNATURE

  	
   

  	
   

  
	
   

  	
  TELEPHONE
  NO.

  	
   

  	
   

  
							

 

 

THIS
FORM MUST BE EXECUTED IN DUPLICATE.

 

	
  (b)        FOR BANK USE ONLY

  
	
   

  
	
  Confirmation of
  Authenticating Bank’s signature performed by: 

  
	
   

  
	
   

  
	
  Date:

  	
   

  	
   

  	
  Time:

  	
   

  	
  a.m./p.m.

  
	
   

  
	
  Addl Info.:

  	
   

  
							

 

R-20

 

ATTACHMENT S

 

PERFORMANCE
TESTS

 

The following sets forth general parameters for the Performance Tests
which Contractor must perform as part of the Scope of Work in order to
determine whether the Minimum Acceptance Criteria (“MAC”) and Performance
Guarantees described in Attachment T have been achieved.   The Parties shall agree, in accordance with
the provisions of Section 11.3 of the Agreement, upon detailed procedures for
each of the Performance Tests (the “Performance
Test Procedures”); however, the parameters set forth in
this Attachment S shall be included in such Performance Test Procedures.

 

1.             Sendout
Rate Performance Test

 

A Performance Test shall be conducted to determine whether the Facility
has achieved the Sendout Rate MAC specified in Attachment T (“Sendout Rate Performance Test”).  The Sendout Rate Performance Test shall be
conducted in accordance with the Sendout Rate Guarantee Conditions specified in
Attachment T and the applicable Performance Test Procedures which will
include the following general parameters:

 

A.            Prior to
commencement of the Sendout Rate Performance Test:

 

i.              all
vaporizers and associated sendout pumps, controls systems, and auxiliaries will
be operated individually and in parallel up to full capacity of the Equipment,
and Contractor shall have fulfilled all of the other requirements set forth in
the definition of “Ready for Performance Testing”, as more specifically defined
in the Performance Test Procedures which are applicable to the Sendout Rate
Performance Test;

 

ii.             at
least two (2) of the Tanks will be substantially full with additional LNG
supply in route to ensure adequate supply of LNG for the ramp-up period and the
test, to be arranged by Owner;

 

iii.            the
vaporizers and sendout pumps will be operated and brought on line in sequence
and will be operated at full rate for up to twelve (12) hours to line-out the
system. Owner to ensure that the Export Pipeline will be capable of off-taking
the produced Natural Gas at the consequent incremental rates and at the full
test rates during the entire test duration including the sequential ramp-up and
line-out rates prior to start of test.

 

B.            Any disruption of the
Sendout Rate Performance Test for any reason (including due to lack of
available LNG or Export Pipeline limitation) will be noted and logged during
the conduct of the Sendout Rate Performance Test and results of the Sendout
Rate Performance Test will be adjusted, as appropriate, in accordance with the
applicable provisions of the Performance Test Procedures to the extent any such
disruption is due to reasons beyond the control of Contractor.

 

C.            The flow meters
installed to monitor and record the Sendout Rate, as defined in Attachment T
will be calibrated prior to the Sendout Rate Performance Test with results
documented and signed by Owner and Contractor. The following flow meters will
be so calibrated and monitored/recorded during the Sendout Rate

 

S-1

 

Performance Test: (1) SCV Fuel Gas (ultrasonic flow
transmitter on SCV fuel gas line shown on P&ID D01-066), (2) CTG Fuel Gas
(ultrasonic flow transmitter on CTG fuel gas line shown on P&ID D01-0080),
and (3) Master Meter K-103 (on P&ID D01-0050). Procedures for adjusting
actual flow rates in order to account for accuracy ranges of the above flow
meters will be determined in accordance with generally accepted standards in
the U.S. Natural Gas industry and specified in the Performance Test
Procedures.  LNG Tank blanketing gas
consumption during the Sendout Rate Performance Test will be determined by
calculation, which will be defined during detailed design and approved by
Owner.

 

	
   

  	
   

  	
  Flow

  	
   

  	
  Measuring Location

  	
   

  	
  Flow Measured (MMSCFD)

  
	
  A

  	
   

  	
  SCV Fuel gas

  	
   

  	
  Ultrasonic flow transmitter on SCV fuel gas line
  shown on P&ID D01-0066

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B

  	
   

  	
  CTG Fuel Gas

  	
   

  	
  Ultrasonic flow transmitter on CTG fuel gas line on
  P&ID D01-0080

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C

  	
   

  	
  LNG Tank blanketing calculation

  	
   

  	
  No meter installed. Based on calculation of Tank
  blanket gas.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D

  	
   

  	
  Master Meter K-103

  	
   

  	
  Total Master Meter flows on P&ID D01-0050

  	
   

  	
   

  

 

Sendout Rate = (flow measured for A + B + D) + C (calculated)

 

	
   

  	
   

  	
  Pressure

  	
   

  	
   

  
	
  E

  	
   

  	
  Upstream of Master Meter K-103

  	
   

  	
  Pressure Transmitter located at Back-Pressure
  Control Valve on P&ID D01-0049

  

 

D.            Owner
and Contractor shall confirm that the Guarantee Conditions stipulated in
Section 4 of Attachment T: (i) have been satisfied prior to commencement
of the preparatory activities described in Section 1A above and commencement of
the Sendout Rate Performance Test, and (ii) continue to be satisfied during
conduct of the Sendout Rate Performance Test. 
If, during conduct of the Sendout Rate Performance Test, any deviation
from the Sendout Rate Guarantee Conditions occurs which is not caused by
Contractor, then to the extent such deviation affects the Sendout Rate
Performance Test results, the Sendout Performance Test results will be adjusted
for such deviation using the process simulation model developed and used by
Contractor in performing the design and engineering of the Facility.  The process simulation model shall: (a)
utilize HYSYS version 3.0 software, and (b) be reviewed and approved by Owner
as part of the Performance Test Procedures. 
The resulting output of such analysis will, if agreed by the
Parties,  constitute the Sendout Rate
Performance Test results for purposes of Attachment T

 

S-2

 

2.             Ship
Unloading Time Performance Test

 

A Performance Test shall be conducted to determine whether the Facility
has achieved the Ship Unloading Time MAC specified in Attachment T (“Ship Unloading Time Performance Test”).  The Ship Unloading Time Performance Test
shall be conducted in accordance with the Guarantee Conditions specified in Attachment
T and the applicable Performance Test Procedures which will include the
following general parameters:

 

A.            Prior to the Ship Unloading
Time Performance Test, Owner will provide one LNG ship of sufficient capacity
to meet requirements set out in the Test Procedures, in terms of volume and
unloading rate, which will be unloaded at the Target Unloading Rate specified
in Paragraph D below, assuming use of all available unloading liquid arms and
vapor return arms on any one jetty.

 

B.            Owner will submit
information on the LNG ship designated for the Ship Unloading Time Performance
Test to Contractor, including the LNG ship’s certified unloading pump curves
and other data reasonably required by Contractor at least twenty-one (21) Days
prior to the Ship Unloading Time Performance Test.

 

C.            Owner will submit
information on source and specification of LNG cargo to be unloaded during the
Ship Unloading Time Performance Test at least twenty-one (21) Days weeks prior
to such test.

 

D.            The ship’s unloading
pumps will be brought on-line and in sequence and lined out to achieve an
unloading rate of 12,600 m3 per hour (“Target Unloading Rate”) with
LNG in the ship’s tanks at least 90% full before commencement of the Ship
Unloading Test period. If the LNG ship design or operation limits the unloading
rates to less than the Target Unloading Rate for reasons other than due to
Contractor, Subcontractors, Sub-subcontractors or any other Person for which
Contractor is responsible, an adjustment will be made in accordance with the
Performance Test Procedures such that Contractor will not be penalized for the
difference between the Target Unloading Rate and actual rate for purposes of
determining unloading times.

 

E.             Unloaded volume of
LNG will be determined from LNG ship level measurements before, during, and
after test period with level to be logged during test and which Owner and
Contractor will monitor during the test. Methodology shall be based on the
Facility procedures for custody transfer of LNG from the ship.

 

F.             Any ship demurrage,
onboard monitoring, third party surveying, or other third party costs
associated with the Ship Unloading Time Performance Test will be the
responsibility of the Owner.

 

G.            Owner and Contractor
will confirm that the Ship Unloading Time Guarantee Conditions stipulated in
Section 4 of Attachment T have been satisfied prior to and during any
Ship Unloading Time Performance Test. If, during conduct of the Ship Unloading
Time Performance Test, any deviation from the Ship Unloading Time Guarantee
Conditions occurs which is not caused by Contractor, then to the extent such
deviation affects the Ship Unloading Time Performance Test results, the Ship
Unloading Time Performance Test results will be adjusted for such deviation
using the process simulation model developed and used by Contractor

 

S-3

 

in performing the design and engineering of the
Facility.  The process simulation model
shall: (a) utilize HYSYS version 3.0 software, and (b)  be reviewed and approved by Owner as part of
the Performance Test Procedures.  The
resulting output of such analysis will, if agreed by the Parties,  constitute the Ship Unloading Time
Performance Test results for purposes of Attachment T

 

S-4

 

ATTACHMENT T

 

PERFORMANCE GUARANTEES,
PERFORMANCE LIQUIDATED DAMAGES,

MINIMUM ACCEPTANCE CRITERIA AND DELAY LIQUIDATED DAMAGES

 

1.                                      Definitions

 

“Sendout Rate” means the average rate
(in MMSCFD) at which LNG is vaporized by the Facility over a specified period
of time.  The Sendout Rate shall be
calculated by adding:  (i) the quantity
of Natural Gas measured at the outlet of the Master Meter (as defined in Schedule
A-1), plus (ii) all fuel gas used in the Facility, plus (iii) any
calculated blanket gas returned to the Tanks, as such calculation is described
more fully in Section 1C of Attachment S.

 

“Ship Unloading Time” means
the time actually required to unload a specified volume of LNG from an LNG ship
at the unloading dock.

 

“Commissioning”
means the completion of all activities required following mechanical completion
and prior to start-up of systems.

 

2.                                      Minimum
Acceptance Criteria

 

The Minimum Acceptance Criteria for the Sendout Rate
and the Ship Unloading Time are as follows:

 

A.           Sendout Rate.   The Facility shall vaporize LNG for twenty
four (24) continuous hours at an average rate of 2,400 MMSCFD or above (the “Sendout
Rate MAC”) at a temperature of no less than 40°F and at a pressure of no less
than 1,250 PSIG, using no more than fifteen (15) vaporizers; provided that the
Sendout Rate Guarantee Conditions stipulated in Section 4 of this Attachment
T are met. 

 

B.             Ship Unloading
Time.  The Facility shall unload from
a ship at the unloading dock into, at Owner’s option Tank 1, Tank 2, Tank 3 or
any combination thereof, 100,000 m3 of LNG in no more than ten (10)
consecutive hours (the “Ship Unloading Time MAC”); provided that the Ship
Unloading Time Guarantee Conditions stipulated in Section 4 of this Attachment
T are met.  Time to hookup, test,
startup and Cool Down of the unloading system shall not be counted as part of
such 10- hour period.  

 

C.             If the applicable Guarantee Conditions for
the Sendout Rate or the Ship Unloading Time are not met during the applicable
Performance Test, the Parties shall, with respect to the applicable Sendout
Rate or Ship Unloading Time, take such actions as are specified in the Performance
Test Procedures.

 

3.                                      Performance
Guarantees

 

The Performance Guarantees for the Sendout Rate and
the Ship Unloading Time are as follows:

 

T-1

 

A.           Sendout Rate
Performance Guarantee.  The Facility
shall vaporize LNG for twenty four (24) continuous hours at an average Sendout
Rate of 2,730 MM SCFD (the “Sendout Rate Performance
Guarantee”) at a temperature of no less than 40°F and at a
pressure of no less than 1,250 PSIG, using no more than fifteen (15) vaporizers;
provided that the Sendout Rate Guarantee Conditions stipulated in Section 4 of
this Attachment T are met.

 

B.             Ship Unloading
Time Performance Guarantee.  The
Facility shall unload from a ship at the unloading dock into, at Owner’s option
Tank 1, Tank 2, Tank 3 or any combination thereof, 120,000 m3 of LNG
in no more than ten (10) consecutive hours (the “Ship
Unloading Time Performance Guarantee”); provided that the Ship
Unloading Time Guarantee Conditions stipulated in Section 4 of this Attachment
T are met.  Time to hookup, test,
startup, and Cool Down of the unloading system shall not be counted as part of
such 10-hour period.

 

C.             If the applicable
Guarantee Conditions for the Sendout Rate or Ship Unloading Time are not met
during the applicable Performance Test, the Parties shall, with respect to the
applicable Sendout Rate or Ship Unloading Time, take such actions as are
specified in the Performance Test Procedures.

 

4.                                      Guarantee
Conditions.

 

A.           Sendout Rate
Guarantee Conditions.  The conditions
upon which the Sendout Rate MAC and the Sendout Rate Performance Guarantee (the
“Sendout Rate Guarantee Conditions”)
are based are as follows:

 

(i)            The sendout pressure of the Natural Gas shall
be measured directly upstream of the back-pressure control valve located just
upstream of the Master Meter, as described in Section 1C of Attachment S.
The temperature of the Natural Gas shall be measured at the discharge of the
vaporizers.

 

(ii)           The Export Pipeline will be capable of
receiving Natural Gas at a rate which is equal to the Sendout Rate Performance
Guarantee plus overages up to and including 5% of the Sendout Rate Performance
Guarantee.

 

(iii)          The operating pressure of Natural Gas in the
Export Pipeline will be 1,250 PSIG or less.

 

(iv)          The composition of the LNG utilized for
purposes of the Sendout Rate Performance Test will be Trinidad Supply Source
set forth in Schedule A-2.

 

(v)           A ship will unload LNG at an unloading rate
of at least 10,000 m3/hr for at least 10 hours during the Sendout
Rate Performance Test period.

 

B.             Ship
Unloading Time Guarantee Conditions. 
The conditions upon which the
Ship Unloading Time MAC and the Ship Unloading Time Performance Guarantee (the “Ship Unloading Time Guarantee Conditions”)
are based are as follows:

 

T-2

 

(i)            The composition of the ship’s cargo of LNG
will be within the LNG specification ranges set forth in Schedule A-2. 

 

(ii)           The average temperature of the ship’s cargo of LNG will be no greater
than 0.1oF above the average temperature of the LNG in the Tank.

 

(iii)          The elevation of the ship’s manifold will be a minimum of 70 feet above the mean low water
level.

 

(iv)          The pumps on the LNG ship will have proven capability (as demonstrated
by the ship’s pump curve provided by Owner to Contractor) of delivering LNG at
a minimum flowrate of 12,600 m3/hr and at a minimum pressure of 67.5 psig as
measured downstream of any temporary strainer installed between the ship’s and
unloading arm’s flanges.

 

(v)           The LNG transport ship will be capable of receiving vapor at a rate
equal to the vapor displaced. Vapor will be provided to the ship at a pressure
of no less than 5 PSIG and at a temperature of no warmer than -180°F at the
ship’s manifold.

 

(vi)          The pressure in the Tank which is receiving the LNG will be maintained
at constant pressure during ship unloading.

 

(vii)         Tank pressure control will be based on absolute pressure.

 

(viii)        All of the vents on the Tank will be set so that they do not vent at a
pressure of less than 2.0 PSIG.

 

(ix)           The ship has net unloadable capacity exceeding 120,000 m3 plus the
volume of LNG pumped to on-shore Tanks during Cool Down of the unloading system
and line-out before the Ship Unloading Time Performance Test commences.

 

5.             Performance
Liquidated Damages

 

A.           Sendout Rate
Performance Liquidated Damages. 
Two-hundred Thousand U.S. Dollars (U.S.$200,000) for every MMSCFD less
than the Sendout Rate Performance Guarantee (“Sendout
Rate Performance Liquidated Damages”).

 

B.             Ship Unloading
Time Performance Liquidated Damages. For every minute longer than the Ship
Unloading Guarantee:

 

(i)            Twenty
Five Thousand US Dollars (US $25,000) for every minute from 1 to and including
30 minutes longer than the Ship Unloading Time Performance Guarantee; plus

 

(ii)           Seventy
Five Thousand US Dollars (US $ 75,000) for every minute from 31 to and
including 60 minutes longer than the Ship Unloading Time Performance Guarantee;
plus

 

(iii)          One
Hundred Twenty Five Thousand US Dollars (US $ 125,000) for every minute from 61
to and including 90 minutes longer than the Ship Unloading Time Performance
Guarantee; plus

 

T-3

 

(iv)          One
Hundred Seventy Five Thousand US Dollars (US $ 175,000) for every minute
exceeding 90 minutes longer than the Ship Unloading Time Performance Guarantee,

 

(“Ship Unloading Rate Performance Liquidation
Damages”).

 

6.             Delay
Liquidated Damages

 

A.           RFCD Delay
Liquidated Damages.  If RFCD occurs
after the date listed in Contractor’s second notice given in accordance with
Section 11.1 of the Agreement for a reason attributable to Contractor or any of
its Subcontractors or Sub-subcontractors, Contractor shall pay to Owner
Seventy-Five Thousand U.S. Dollars (U.S.$75,000) per Day for each Day, or
portion thereof, of delay until RFCD occurs (“RFCD
Delay Liquidated Damages”).

 

B.             Substantial
Completion Delay Liquidated Damages.

 

1.                                       If
Substantial Completion occurs after the Guaranteed Substantial Completion Date,
Contractor shall pay to Owner amounts according to the following schedule for
each Day, or portion thereof, of delay until Substantial Completion occurs:

 

a.               Eighty-four
Thousand U.S. Dollars (U.S. $84,000) per Day from 1 Day to and including 15
Days after Guaranteed Substantial Completion Date,  plus

 

b.              Two Hundred Ten
Thousand U.S. Dollars (U.S. $210,000) per Day from 16 Days to and including 30
Days after Guaranteed Substantial Completion Date, plus

 

c.               Three Hundred Fifty
Thousand U.S. Dollars (U.S. $350,000) per Day for 31 Days and more after
Guaranteed Substantial Completion Date,

 

(“Substantial
Completion Delay Liquidation Damages”).

 

2.                                       The
Substantial Completion Delay Liquidated Damages set forth in Section 6.B.1. of
this Attachment T shall be reduced to the
following amounts if only System 1 achieves, on or before the Guaranteed
Substantial Completion Date, a Sendout Rate of 1,250 MMSCFD or above at a
temperature of no less than 40°F and at a pressure of no less than 1,250 PSIG,
and based on the use of no more than seven (7) vaporizers plus one (1) spare
vaporizer; provided that
the Sendout Rate Guarantee Conditions stipulated in Section 4  of this Attachment T are met:

 

a.               Sixty Thousand U.S.
Dollars (U.S. $60,000) per Day from 1 Day to and including 15 Days after
Guaranteed Substantial Completion Date, plus

 

b.              One Hundred Twenty
Thousand U.S. Dollars (U.S. $120,000) per Day from 16 Days to and including 30
Days after Guaranteed Substantial Completion Date, plus

 

T-4

 

c.               Two Hundred
Thirty-five Thousand U.S. Dollars (U.S. $235,000) per Day from 31 Days and more
after Guaranteed Substantial Completion Date.

 

3.                                       The
Substantial Completion Delay Liquidated Damages set forth in Section 6.B.1. of
this Attachment T shall be reduced to the
following amounts if System 1 and System 2 collectively achieve, on or before
the Guaranteed Substantial Completion Date, 
a Sendout Rate of 2,000 MMSCFD or above at a temperature of no less than
40°F and at a pressure of no less than 1,250 PSIG, and based on the use of no
more than twelve (12) vaporizers plus one (1) spare vaporizer; provided that
the Sendout Rate Guarantee Conditions stipulated in Section 4  of this Attachment T are met:

 

a.               Thirty Thousand
U.S. Dollars (U.S. $30,000) per Day from 1 Day to and including 15 Days after
Guaranteed Substantial Completion Date, plus

 

b.              Sixty Thousand U.S.
Dollars (U.S. $60,000) per Day from 16 Days to and including 30 Days after
Guaranteed Substantial Completion Date, plus

 

c.               One Hundred Twenty
Thousand U.S. Dollars (U.S. $120,000) per Day from 31 Days and more after
Guaranteed Substantial Completion Date

 

7.             Priority.

 

In the event of a conflict or inconsistency between provisions
contained within this Attachment T and provisions contained within Attachment
A, the provisions within this Attachment T shall control.

 

T-5

 

ATTACHMENT U

 

OWNER PROVIDED ITEMS AND RESPONSIBILITY

 

1.             Soil
Testing Confirmation

 

Within forty-five (45) Days after Owner’s issuance of the LNTP, Owner
shall provide Contractor with evidence from the FERC confirming that soil
testing activities may commence prior to Owner’s issuance of the NTP.  In the event Owner fails to provide such
evidence to Contractor and such failure adversely affect (i) Contractor’s cost
of performance of the Work; (ii) Contractor’s ability to perform the Work in
accordance with the Project Schedule, or (iii) Contractor’s ability to perform
any material obligation under this Agreement, Contractor shall be entitled to a
Change Order; provided that Contractor complies
with the requirements of Sections 6.2, 6.5 and 6.9 of the Agreement.

 

2.             Owner
Supplied Data

 

The following data, information, and documents listed below shall be
provided by Owner on or before the dates listed below.  Refer to Schedule A-2 for the data,
information, and documents which are defined as “Rely Upon” items pursuant to
Section 4.8 of the Agreement.

 

	
  Description of
  Data/Information/Documents Provided

  	
   

  	
  Date Provided

  or to be Provided

  
	
  Application for Authorization to Site Construct and
  Operate Liquefied Natural Gas Import Terminal Facilities, pursuant to Section
  3(a) of the Natural Gas Act and Parts 153 and 380, Docket No. CP04-47 et al,
  filed by Owner with the FERC on December 23, 2003 (the “FERC
  Application”), including responses to subsequent data requests
  in connection with the FERC Application.

  	
   

  	
  Previously provided to Contractor.

  
	
   

  	
   

  	
   

  
	
  Final Environmental Impact Statement, FERC Docket
  No. CP04-47 et al, dated November 12, 2004

  	
   

  	
  Previously provided to Contractor.

  
	
   

  	
   

  	
   

  
	
  Lonnie G. Harper & Associates Survey of Property
  lease, Sabine Pass, dated January 26, 2004

  	
   

  	
  Previously provided to Contractor.

  
	
   

  	
   

  	
   

  
	
  Topographic Survey by Lonnie Harper, dated November
  2003

  	
   

  	
  Previously provided to Contractor.

  
	
   

  	
   

  	
   

  
	
  Owner Supplied Permits listed in Attachment Q

  	
   

  	
  In accordance with the date specified under the
  “Date Required” column in Attachment Q

  
	
   

  	
   

  	
   

  
	
  Pre-construction Sound Survey and Noise Modeling
  Sabine Pass Report, dated November 6, 2003, Owner/HFP Acoustical Consultants,
  Inc. (Contractor Scope of Work covers base line noise study and noise study
  during pile driving.)

  	
   

  	
  Previously provided to Contractor.

  

 

U-1

 

	
  Facility Security Plan (Contractor will assist in
  development in accordance with Attachment A)

  	
   

  	
  Prior to RFCD.

  
	
   

  	
   

  	
   

  
	
  Facility Security Assessment (Contractor will assist
  in development in accordance with Attachment A)

  	
   

  	
  Prior to RFCD.

  
	
   

  	
   

  	
   

  
	
  Vessel Security Plan (Contractor will assist in
  development in accordance with Attachment A)

  	
   

  	
  Prior to RFCD.

  

 

3.             Owner
Supplied Equipment, Items, and Services

 

The following equipment, components, and personnel shall be supplied by
Owner on or before the dates listed below in accordance with Attachment A.  Contractor shall provide reasonable support
and assistance to the Owner in accordance with the Agreement (including, where
applicable, access to Site).

 

	
  Description of
  Equipment/Components/Personnel Supplied

  	
   

  	
  Date Supplied

  or to be Supplied

  
	
  Provide all work associated with overall program
  management among other contractors working directly for Owner and not in
  Contractor Group (“Owner’s Suppliers”),
  including Owner’s Suppliers for the Export Gas Pipeline, wetland mitigation,
  permitting agencies, Owner consultants, and Owner’s activities.

  	
   

  	
  Ongoing requirement under the terms of the
  Agreement.

  
	
   

  	
   

  	
   

  
	
  Provide access to hydrotest water source in
  accordance with Attachment A.

  	
   

  	
  No later than July 1, 2007, or as adjusted by Change
  Order in accordance with the terms of the Agreement.

  
	
   

  	
   

  	
   

  
	
  Provide leased nitrogen plant and supply of nitrogen
  sufficient for operation of the Facility after Substantial Completion.
  Contractor shall make final connections to the nitrogen plant. Contractor
  shall provide nitrogen for purging of Tanks, piping, and other Equipment in
  connection with performance of the Work.

  	
   

  	
  No later than January 1, 2008, or as adjusted by
  Change Order in accordance with the terms of the Agreement.

  
	
   

  	
   

  	
   

  
	
  Make Owner’s personnel available for training
  pursuant to Section 3.5 of the Agreement.

  	
   

  	
  As required by the training program to be developed
  in accordance with Attachment V.

  
	
   

  	
   

  	
   

  
	
  Make Owner’s personnel available to Contractor for
  commissioning and testing pursuant to the terms of the Agreement, including
  Section 4.4.

  	
   

  	
  As required under the Project Commissioning Plan.

  
	
   

  	
   

  	
   

  
	
  Provide any outside training and certification
  required by Applicable

  	
   

  	
  Prior to RFCD.

  

 

U-2

 

	
  Law for Owner personnel shall be coordinated by
  Owner (other than the training to be provided by Contractor in accordance
  with Section 3.5 of the Agreement).

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Provide LNG shipping and offshore logistics,
  including (i) supply of three (3) tugboats, two (2) line boats, ships other
  offshore permanent Facility transport vehicles and all related equipment (except
  the permanent navigational aids to be provided by Contractor in accordance
  with Attachment A) and (ii) communication and interface with pilot’s
  organization.

  	
   

  	
  Prior to RFCD.

  
	
   

  	
   

  	
   

  
	
  Provide the LNG necessary for Contractor (i) to
  achieve Cool Down in accordance with Sections 11.1 and 11.2 of the Agreement
  and (ii) to conduct the Performance Tests and other commissioning activities
  in accordance with Section 11.3 of the Agreement.

  	
   

  	
  As required under Sections 11.1, 11.2 and 11.3 of
  the Agreement.

  
	
   

  	
   

  	
   

  
	
  Provide Export Gas Pipeline up to the designated
  tie-in points on the outlet weld-in-insulator at the Master Meter. Owner will
  be responsible for tie-in from Export Gas Pipeline to the Contractor provided
  Master Meter.  Pipeline contractor will
  be responsible for access and laydown area development. Contractor will
  identify laydown and staging areas for the pipeline contractor.

  	
   

  	
  No later than August 1, 2007, or as adjusted by
  Change Order in accordance with the terms of the Agreement.

  
	
   

  	
   

  	
   

  
	
  Purchasing and coordinating Natural Gas from Export
  Gas Pipeline for startup and initial operation of the Facility. Until
  vaporized, imported LNG can supply fuel gas to gas turbine generators.

  	
   

  	
  No later than August 1, 2007, or as adjusted by
  Change Order in accordance with the terms of the Agreement.

  
	
   

  	
   

  	
   

  
	
  Wetlands mitigation to be performed on or off the
  Site.

  	
   

  	
  In accordance with the mitigation plan filed with
  the USACE.

  
	
   

  	
   

  	
   

  
	
  Provide
  in-plant UHF and VHF base radio and handheld radio system.

  	
   

  	
  Prior to
  RFCD.

  
	
   

  	
   

  	
   

  
	
  Provide
  vehicles for Owner’s own use.

  	
   

  	
  As
  determined by Owner.

  
	
   

  	
   

  	
   

  
	
  Provide
  permanent plant water (if from local utility)

  	
   

  	
  No later
  than January 1, 2008

  
	
   

  	
   

  	
   

  
	
  Relocate
  underground pipeline from existing oil/gas well

  	
   

  	
  No later
  than May 1, 2005

  

 

U-3

 

4.             Budgeted Work by Contractor to Support Work by Owner or
Others

 

Contractor shall provide
reasonable assistance to Owner or to others to execute the work described
below.  The Contract Price includes a
total of 1,250 man-hours to support Owner for all items listed below.  Any additional assistance requested by Owner
that would exceed a total of 1,250 man-hours shall be adjusted by Change Order
in accordance with the terms of the Agreement. 
There is no allowance for equipment or material assistance.

 

A.            Rerouting
of underground pipeline from existing oil/gas well

 

B.            All
work associated with LNG shipping and logistics, including shipping studies

 

C.            All
work associated with monitoring and reporting in accordance with the air permit

 

D.            All
work associated with Owner Permits (Attachment Q), including development
and coordination; provided, however, such work does
not include the one thousand (1000) man-hours of support for FERC-related
activities which shall be provided by Contractor in accordance with Section 10
of Attachment A

 

E.             Site
acquisition and costs associated with acquisition of the Site and Off-Site
Rights of Ways and Easements

 

F.             Environmental
data gathering, interpretation, permitting and related requirements, impact assessments,
baseline studies and compliance issues, other than as included in Contractor’s
Scope of Work or required under Applicable Law or Permits in connection with
Contractor’s performance of the Work

 

G.            All
community relations, government relations and public relations, except as
directly related to construction and labor relations during construction

 

H.            Work
associated with supporting any reasonable requests by Lender in connection with
the financing

 

I.              Landscaping
requirements

 

J.             Permanent
Facility office supplies or rolling stock

 

K.            Supply
of tugboats, line boats, ships, and other onshore and offshore permanent
Facility transport vehicles and all related equipment (except that permanent
navigational aids will be provided by Contractor in accordance with Attachment
A)

 

L.             Owner
will be responsible for the permanent facility building’s computer equipment,
servers, and non-controls related network

 

M.           Laboratory
equipment (except that Contractor will provide gas chromatographs)

 

U-4

 

N.            Except
as provided in Section 3.4 of the Agreement and in Attachment A,
stocking and purchase of bulk warehouse items such as solvents, consumables,
furniture, tools, and shelving

 

O.            Communication
and interface with pilot’s organization

 

P.             Permit
for helipad and any equipment required for the helipad and helicopter
accessibility

 

Q.            Agreements
with local community fire and emergency management system applicable after
Substantial Completion

 

R.            Computer
and telecommunications equipment (other than telephones, as provided by
Contractor in accordance with Schedule A-1) for Owner personnel during
construction, commissioning, and operation of the Facility

 

U-5

 

ATTACHMENT V

 

PRE-COMMISSIONING,
COMMISSIONING, START-UP, AND TRAINING

 

1.0                               Introduction

 

In addition to the requirements
specified in any other provisions of the Agreement, this Attachment V
sets out the general scope of activities to be performed by Contractor for the
construction/turnover, pre-commissioning, commissioning, start-up, and
operation (until Substantial Completion) of the Project.  This Attachment V does not constitute
a substitute for the Project Commissioning Plan or the start-up manual, but
rather forms the basis for the development of such Project Commissioning Plan
and manual.

 

The following phases of
activities are generally described in this Attachment V:

 

A.           Pre-commissioning: preparation of a system or
systems for the commissioning phase. This will include, but is not limited to,
blowing, flushing, and Equipment testing, and initial check out of Facility
process and utility systems. Pre-commissioning Work is a construction
responsibility which will be performed with the assistance of Contractor’s
pre-commissioning/commissioning team (the “PC/C Team”).

 

B.             Commissioning:  preparation of a system or systems to allow
hydrocarbons or other process fluids to be safely introduced into the system or
systems for processing. In this phase testing will focus on systems, including
utilities. Process units will be purged with nitrogen, dried out and made ready
for Cool Down.

 

C.             Start-up: the bringing of a system or systems
into a normal operational mode, including Cool Down of cryogenic and LNG storage
systems, and the first LNG ship unloading. 
This phase ends upon the completion of the Performance Tests.

 

D.            Operation – subsequent LNG ship unloading and
LNG sendout with and without LNG ship unloading.

 

2.0                               General

 

Contractor will perform pre-commissioning, commissioning, and startup
for the Facility so as to achieve completion of required systems to enable
commencement of operations of the Facility in accordance with the Project
Schedule.

 

3.0                               Project
Commissioning Plan; Start-Up Manual

 

A.           Pursuant to Section 4.4 of the Agreement,
Contractor shall prepare and provide to Owner a detailed Project Commissioning
Plan, which shall include commissioning procedures that address commissioning
activities to be performed for the Work. 
The Project Commissioning Plan shall address utilization of Owner’s
operation and maintenance personnel and Contractor’s personnel during
commissioning and conduct of the Performance Tests.

 

B.             Contractor shall prepare and provide a
detailed start-up manual for Owner’s review and approval prior to final
HAZOP.  The manual will include
Contractor’s start-up

 

V-1

 

plan and start-up
procedures, including procedures for achieving Cool Down of the Facility, and
will address, at a minimum, the start-up activities described in Section 8.0  below and will also detail how Contractor will
achieve, the Minimum Acceptance Criteria and Performance Guarantees set forth
in Attachment T, the Performance Tests set forth in Attachment S
and the requirements for Substantial Completion.

 

4.0                               Contractor’s
Organization/Manpower

 

A.           The PC/C Team will consist of Contractor’s
personnel who are experienced in pre-commissioning, commissioning and start-up
of petrochemical facilities, some of whom shall have been involved in FEED
work, engineering and construction Work. Contractor will also involve
appropriate selected vendors’ representatives to assist in pre-commissioning,
commissioning and start-up activities. Contractor will assign a senior Startup
Manager to lead the PC/C Team throughout the Project execution. Without
limiting Contractor’s responsibility to provide sufficient qualified personnel
to perform the Work, Contractor’s PC/C Team will have primary responsibility
for the commissioning activities and start-up activities as described below.

 

B.             The PC/C team will be formed, and will carry
out the following activities during, the engineering phase:

 

•                  Review
of engineering design including input for operation, maintenance and startup of
the Facility.

 

•                  Participate
along with Owner’s personnel, in HAZOP reviews.

 

•                  Participate
in activities identifying commissioning spare parts and two years operational
spare parts.

 

•                  Prepare,
with Contractor’s construction personnel, the pre-commissioning and commissioning
manual for each unit.

 

•                  Prepare
a first draft of the startup, operations and maintenance manuals.

 

•                  Prepare,
with Contractor’s construction personnel, a first draft of the Safety Plan for
pre-commissioning, commissioning and start-up.

 

•                  Identify
systems and/or packages for proper turnover in a logical sequence for a safe
startup of the Facility.

 

•                  Prepare,
with Contractor’s construction personnel, a pre-commissioning, commissioning ,
start-up and turnover schedule.

 

•                  Prepare
test run documents and forms.

 

V-2

 

5.0                               Pre-commissioning

 

A.           The PC/C manager and other members of the
PC/C team as necessary will relocate to the Site in time to assist Contractor’s
construction personnel with completion of the Work and pre-commissioning, and
for the purpose of commencing on-Site training of Owner’s personnel under
Section 6.0 below.

 

B.             Although overall responsibility for the
pre-commissioning rests with Contractor’s construction force, the PC/C Team
will assist, advise and witness testing during this phase. The team will also
complete the Safety Plan and startup, operations and maintenance manuals during
this phase.

 

C.             Details of pre-commissioning test procedures
will be developed by Contractor and reviewed by Owner.  The schedule of pre-commissioning and
commissioning activities will be marked up to reflect progress and updated or
revised, as appropriate, after review with Owner.

 

D.            Contractor, acting through the PC/C Team,
shall also be responsible for the following Work during this phase:

 

•                  Inspect
construction Work for conformance to design and for cleanliness.

 

•                  Inspect
construction records for accuracy and completeness.

 

•                  Check
Equipment and systems and prepare preliminary Punchlists.

 

•                  Supervise,
advise, and generally assist construction personnel during pre-commissioning
testing.

 

•                  Verify
that mechanical checks have been performed, per detailed checklists.

 

•                  Inspect
all Equipment that is delivered to Site in a preserved condition so that preservation
methods used will protect the integrity of the Equipment.  Monitoring such Equipment on Site such that
the preservation is maintained until the actual connection to system piping and
other Equipment is made. Verify that any field piping or Equipment connection
to preserved Equipment has been cleaned and purged before blind removal is
made.

 

•                  Prepare
all necessary inspection records and test certificates. Confirm all
documentation is in place to allow any given system to go on to the
commissioning phase and have in place and provide to Owner, for review, a “Ready
For Commissioning Certificate” (RFCC) applicable to each system.

 

•                  Expedite
the transition from pre-commissioning activities to commissioning activities so
that progress is not delayed.

 

•                  Monitor
vendor representative activities so that personnel are utilized effectively and
that they make a positive contribution to the training program.

 

•                  Plan
and initiate the training program described in Section 6.0.

 

V-3

 

•                  Final
inspection of vessels and other Equipment internals and closing and leak
testing of such vessels and Equipment where applicable.  (Some vessels may be final inspected in the
initial stage of the commissioning phase)

 

•                  Final
cleanliness inspection and closing of large-diameter piping.

 

6.0                               Training
Program

 

A.           In accordance with Section 3.5 of the
Agreement, Contractor shall design and conduct at the Site, or other locations
and at times mutually agreeable to the Parties, a Facility-specific training
program for Operator’s personnel covering the following:

 

•                  Vendor
Specific Training on:

 

•                  DCS

 

•                  LNG
pumps

 

•                  Boil
Off Gas Compressors

 

•                  Submerged
Combustible Vaporizers

 

•                  Fire
& gas systems

 

•                  LNG
Tank systems and instrumentation

 

•                  Safety
instrumented systems (ESD etc.)

 

•                  Analyzers

 

•                  Basic
LNG Training Program:

 

•                  Basic
explanation of Facility function and layout

 

•                  Facility
design basics

 

•                  FERC
requirements

 

•                  Pre-commissioning
procedures

 

•                  Commissioning
procedures

 

•                  Testing
of each system and item of Equipment

 

•                  Operating
procedures (for each system and item of Equipment):

 

•                  Initial
start-up

 

•                  Normal
operation

 

•                  Normal
shutdown

 

•                  Emergency
shutdown

 

•                  Safety
philosophy

 

•                  Safety
procedures

 

•                  Performance
of routine, preventative and emergency maintenance for each item of Equipment

 

V-4

 

•                  Spare
parts to be maintained for each item of Equipment and their installation and
removal

 

•                  Gas
Technology Institute Training Program & Certification

 

B.             The training program will be given to fifty
(50) Owner personnel.

 

C.             The training program outlined above will be
conducted by selected instructors (including Contractor’s engineers,
specialists, technicians, and selected vendor representatives, in addition to
the PC/C Team members), who, in Contractor’s judgment, are qualified to provide
such training. Subcontractors and Sub-subcontractors who are vendors of
selected Major Equipment will provide training for such Equipment.

 

D.            Contractor will cooperate with the Owner in
the utilization of the Facility for training of Owner’s personnel during
commissioning and other activities where practical.

 

7.0                               Commissioning

 

A.           Field engineering, maintenance, safety,
administrative and manual labor personnel carried forward from the construction
force will augment the PC/C Team during commissioning activities. Contractor
will supply all personnel, in addition to personnel provided by Owner for
supervision by Contractor pursuant to Section 4.4 of the Agreement, as required
to commission and startup the Facility and for continuous operation of the
Facility.

 

B.             Certain portions of the Work may be entering
the commissioning or start up phase while other portions of the Work are still
in the pre-commissioning phase or in general construction.

 

C.             Contractor and Owner shall interface with
Owner’s Export Pipeline contractor to achieve the transition from
pre-commissioning to commissioning to start-up and Natural Gas sendout.

 

D.            During commissioning, Contractor shall
perform the activities required to make the Equipment ready to receive LNG for
storage, processing/vaporizing and for the transfer of Natural Gas to the
Export Pipelines, all in accordance with the other provisions of the
Agreement.  Such activities include but
are not limited to:

 

•                  Arranging
for vendor service/startup representatives to be present at the Site at all
appropriate times, including during commissioning and RFCD, start-up, and
Performance Testing.

 

•                  Oxygen
freeing of piping and Equipment using inert gas such as nitrogen.

 

•                  Dry
out of systems to make ready for introduction of hydrocarbons and for Cool Down
using LNG.

 

•                  Plan
and supervise any degreasing and cleaning/pickling of systems as required.

 

V-5

 

•                  Introduction
of any process chemicals such as refrigerants to any system if required.

 

•                  Vaporizer
dry out and final inspection, including for safety and operability.

 

•                  Initial
charging of solvents and chemicals if applicable.

 

•                  Cleaning
and checking of temporary strainers during initial circulation or fluid flow
operations.

 

•                  Circulating lube
oil systems and checking operation of all system components and system
cleanliness.

 

•                  Checking,
testing and documenting all hazard detection, firefighting and other loss
prevention systems and equipment in order to satisfy Applicable Laws and
Applicable Codes and Standards.

 

•                  Normal
electric power source put in service and functional.

 

•                  Plant
communications and communications with marine facilities shall be fully
operational.

 

•                  Export
Pipeline and interface with remainder of the Facility completed; communications
with Export Pipeline operator and Natural Gas management system established.

 

•                  Potable,
service water and fire water systems made operational.

 

•                  Plant
air, instrument air and nitrogen generation unit made operational.

 

•                  Unloading
arm operating systems checked out, including PERC and instrument/alarm systems
as per vendor’s instructions.

 

•                  The
wastewater disposal systems made ready and functional.

 

•                  Instruments
checked out, loop tested, calibrated and system documentation completed.

 

•                  Portable
gas detectors made available in accordance with Applicable Law and Applicable
Codes and Standards.

 

•                  Confirm
documentation is in place and activities completed for issuance of the RFCD
Completion Certificate by Contractor, and issued in accordance with Section
11.1 of the Agreement.

 

8.0                               Start-up

 

A.           Start-up activities will begin on a system or
subsystem of the Equipment when (1) the RFCD Completion Certificate has been
accepted in accordance with Section 11.4 of the Agreement, and (2) the approved
start-up procedures (as set forth in the start-up manual referred to in Section
3.0 above) are in place at the Site. All personnel involved in start-up
activities shall be trained and shall be conversant with the content and
application of all such procedures.

 

V-6

 

B.             Contractor shall provide all labor,
supervisory personnel, vendor representatives, technicians and other items
necessary to prepare, test and start-up the Facility and the Equipment and for
the execution of the Performance Tests. Owner will provide operating personnel
for supervision by Contractor in accordance with Section 4.4 of the Agreement
and supply the LNG necessary for Contractor to achieve Cool Down and to
commence start-up and conduct the Performance Tests, in accordance with Section
11.1 of the Agreement.

 

C.             The primary objectives of this phase shall be
to unload the first LNG cargo demonstrate that all Minimum Acceptance Criteria
and Performance Guarantees have been met.

 

D.            Activities during start-up will include,
without limitation:

 

•                  Introducing
the normal operating fluids and feedstock to the various systems

 

•                  Conducting
circulating cleanliness checks

 

•                  Purging
of any residual inert gas with Natural Gas.

 

•                  Cleaning
and checking of temporary strainers after initial circulation or fluid flow
operation.

 

•                  Startup
and operation of utility systems required for support of process unit
commissioning if not already in service

 

•                  Checking
safe operation of automatic and manual shutdowns, alarms and emergency
depressuring systems.

 

•                  Cool
Down of plant Equipment and piping, Tanks and unloading systems to make ready
to receive LNG. Tank Cool Down shall be in accordance with Tank vendor’s
approved procedures which shall be incorporated in the start-up manual.

 

•                  Monitor
cool down of Equipment and piping to ensure that the rate of cool down is
correct and to prevent thermal shock and/or unacceptable temperature
differentials.

 

•                  Verify
that all documentation is in place and activities completed as required for
issuance of the Ready for Performance Testing Certificate by Contractor and
that the Guarantee Conditions set forth in Attachment T have been
satisfied prior to conducting Performance Tests.

 

•                  Issue
Ready for Performance Testing Certificate

 

•                  Conduct
Performance Tests in accordance with the Performance Test Procedures and the
other provisions of this Agreement, including Attachment S.

 

9.0                               Operation

 

Prior to Substantial Completion
and after RFCD, to the extent Contractor has care, custody and control of the
Facility, Contractor will operate the Facility in accordance with the
Agreement, including Section 11.8 of the Agreement, and will supply operating
and maintenance personnel in addition to those personnel supplied by Owner for

 

V-7

 

supervision by Contractor
pursuant to Section 4.4 of the Agreement, for operation of the Facility as
required to reach Substantial Completion.

 

Owner will be responsible for nominations
of Natural Gas send out to the Export Pipeline. The Contractor will assist the
Owner in coordinating these activities as requested by Owner.

 

V-8

 

ATTACHMENT
W

 

OPERATING SPARE PARTS LIST

 

	
  Material

  Requisition

  Number

  	
   

  	
  Equipment

  Description

  	
   

  	
  Supplier

  Name

  	
   

  	
  Supplier

  Contact

  Information

  	
   

  	
  Part
  Description

  	
   

  	
  Part

  Number

  	
   

  	
  Estimated

  Price per

  Unit

  (U.S.$)

  	
   

  	
  Quantity

  Required

  	
   

  	
  Extension

  (Estimated Price

  per Unit x

  Quantity

  Required) (U.S.$)

  	
   

  	
  Required
  for

  Delivery Prior to

  Substantial

  Completion or

  Final Completion

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
																					

 

W-1

 

ATTACHMENT
X

 

[Not Used.]

 

X-1

 

ATTACHMENT
Y

 

SITE AND OFF-SITE RIGHTS OF WAY AND EASEMENTS

 

Y-1

 

 

 

 

ATTACHMENT
Z

 

[Not Used.]

 

Z-1

 

ATTACHMENT
AA

 

FORM OF ACKNOWLEDGMENT AND

CONSENT AGREEMENT WITH LENDER

 

Bechtel Corporation (the “Contracting Party”) hereby acknowledges the
existence of (but has not reviewed) the Security Agreement, dated as of [                    ],
200[  ] (as from time to time amended, supplemented or modified, the
“Security Agreement”), among Sabine Pass LNG, L.P. (the “Borrower”), Société
Générale as Agent, and HSBC Bank USA, National Association as Collateral Agent
(in such capacity, the “Collateral Agent”), for the benefit of various
financial institutions providing financing to the Borrower (collectively, the
“Secured Parties”), and hereby executes this Acknowledgement and Consent
Agreement (the “Consent”) and agrees as follows:

 

1.                     The
Contracting Party hereby acknowledges and consents in accordance with the terms
and conditions set forth below to the Borrower’s pledge and collateral
assignment of all its right, title and interest in, to and under (but not,
except as provided herein, its obligations, liabilities or duties with respect
to) the Lump Sum Turnkey Agreement for the Engineering, Procurement and
Construction of the Sabine Pass LNG Receiving, Storage and Regasification Terminal,
dated December 18, 2004, between the Contracting Party and the Borrower (as
supplemented by the Limited Notice to Proceed dated [                        ],
200[  ], and the Notice to Proceed, dated [                    ],
200[  ], the “Assigned Agreement”) to the Collateral Agent pursuant
to the Security Agreement.  Capitalized terms used, but not otherwise
defined, herein shall have the respective meanings ascribed to such terms in
the Assigned Agreement.

 

2.                     The
Contracting Party represents and warrants as of the date hereof as follows:

 

a.                                       The
Contracting Party is a corporation duly organized, validly existing and in good
standing under the laws of Nevada, is authorized and qualified to do business
in all jurisdictions in which the nature of the business conducted by it makes
such qualification necessary and where failure so to qualify would have a
material adverse effect on its financial condition, operations, prospects,
taxes or business.

 

b.                                      The
Contracting Party is not in violation of any Applicable Law or judgment entered
by any Governmental Instrumentality, which violations, individually or in the
aggregate, would affect its performance of any obligations under this Consent
or the Assigned Agreement in any material respect.  There are no legal or
arbitration proceedings or any proceeding by or before any Governmental
Instrumentality, now pending or (to the current actual knowledge of the
Contracting Party) threatened against the Contracting Party that, if adversely
determined, could reasonably be expected to have a material adverse effect on
its ability to perform under this Consent or the Assigned Agreement.

 

c.                                       The
Contracting Party is the holder of all licenses required to permit it to
operate or conduct its business in Louisiana now and as contemplated by the
Assigned Agreement. No consent or approval of, or other action by or any notice
to or filing with, any Governmental Instrumentality (except those previously
obtained) was required in connection with the execution and delivery by the Contracting
Party of the Assigned Agreement, or is required in connection

 

AA-1

 

with the execution and delivery
of this Consent, or, to the best actual current knowledge of the Contracting
Party, the performance of its obligations under this Consent.  The Contracting Party has obtained all
permits, licenses, approvals, consents and exemptions with respect to the
performance of its obligations under the Assigned Agreement required by
Applicable Law in effect as of the date hereof, except those permits, licenses,
approvals, consents and exemptions that the Contracting Party is permitted to
obtain in the ordinary course of business in the performance of its obligations
under the Assigned Agreement (collectively, the “Ordinary Course Consents”).

 

d.                                      Neither
the execution and delivery of this Consent and the Assigned Agreement by the
Contracting Party, the consummation of the transactions herein contemplated by
the Contracting Party, nor compliance with the terms and provisions hereof by
the Contracting Party, will:

 

(i)                                     conflict
with, result in a breach of or default under, or require any consent (other
than consents already obtained and the Ordinary Course Consents) under: (A) the
charter or by-laws of the Contracting Party, (B) any Applicable Law, (C) any
order, writ, injunction or decree of any court applicable to the Contracting
Party, or (D) any agreement or instrument to which the Contracting Party is a
party or by which it is bound or to which it or any of its property or assets
is subject in any such case under this clause (i) that would result in a
material adverse effect upon the ability of the Contracting Party to perform
its obligations under this Consent and the Assigned Agreement; or

 

(ii)                                  result
in the creation or imposition of (or the obligation to create or impose) any
lien, security interest, charge or encumbrance upon any of the properties or
assets of the Contracting Party.

 

e.                                       The
Contracting Party has all necessary power and authority to execute, deliver and
perform its obligations under this Consent and the Assigned Agreement; the
execution, delivery and performance by the Contracting Party of this Consent
and the Assigned Agreement have been duly authorized by all necessary action on
its part; and this Consent and the Assigned Agreement have been duly and
validly executed and delivered by the Contracting Party and each constitutes a
legal, valid and binding obligation of the Contracting Party enforceable in
accordance with its terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization or moratorium or other similar laws
relating to the enforcement of creditors’ rights generally, and by general
principles of equity.  There are no
amendments, modifications or supplements (whether by waiver, consent or
otherwise) to the Assigned Agreement, either oral or written.

 

f.                                         The
Contracting Party is financially solvent, able to pay all debts as they mature
and possesses sufficient working capital to complete the Work and perform its
obligations hereunder.

 

g.                                      To
the Contracting Party’s current actual knowledge, the Borrower (a) has complied
with all conditions precedent required to be complied with by or on behalf of
the Borrower on or prior to the date hereof pursuant to the Assigned Agreement
and (b) is not in default under any covenant or obligation of the Assigned
Agreement and no such default has

 

AA-2

 

occurred prior to the date
hereof.

 

h.                                      The
Contracting Party is not, to its current actual knowledge, in default under any
covenant or obligation hereunder or under the Assigned Agreement and no such
default has occurred prior to the date hereof. After giving effect to the
pledge and assignment referred to in paragraph 1, and after giving effect to
the consent to such pledge and assignment by the Contracting Party, to the
current actual knowledge of the Contracting Party, (a) there exists no event or
condition that would, either immediately or with the passage of time or giving
of notice, or both, entitle either the Contracting Party or the Borrower to
terminate or suspend its obligations under the Assigned Agreement and (b) there
are no claims or rights of set-off pending by any party to the Assigned
Agreement.

 

i.                                          The
Contracting Party affirms that it has no written notice or current actual
knowledge of any pledge or assignment relative to the right, title and interest
of the Borrower in, to and under the Assigned Agreement other than the pledge
and assignment referred to in paragraph 1.

 

3.

a.                                       From
and after the date hereof and unless and until the Contracting Party shall have
received written notice from the Collateral Agent that the lien of the Security
Agreement has been released in full and provided that an event of default by
the Borrower shall have occurred and be continuing pursuant to the loan
documents executed in connection with the Security Agreement, the Collateral
Agent shall have the right, but not the obligation, to pay all sums due under
the Assigned Agreement by the Borrower and to perform any other act, duty or
obligation required of the Borrower thereunder (to the same extent as the
Borrower has the right to perform any such other act, duty or obligation
thereunder) at any time and, without limiting the generality of the foregoing,
shall have the full right and power to enforce directly against the Contracting
Party (subject to all of the Contracting Party’s defenses and other rights
under the Assigned Agreement in accordance with the terms thereof) all obligations
of the Contracting Party under the Assigned Agreement and otherwise to exercise
all remedies thereunder and to make all demands and give all notices and make
all requests required or permitted to be made by the Borrower under the
Assigned Agreement, all in accordance with the terms thereof; provided that no
such payment or performance shall be construed as an assumption by the
Collateral Agent or any Secured Party of any covenants, agreements or
obligations of the Borrower under or in respect of the Assigned Agreement,
except to the extent the Assigned Agreement shall have been expressly assumed
by the Collateral Agent pursuant to paragraph 5 hereof.   Any action taken by the Collateral Agent in
accordance with this paragraph 3(a) shall be binding on the Borrower. If the
Contracting Party receives any demands, notices or requests made from the
Collateral Agent in accordance with this paragraph 3(a) which are conflicting
with that made by the Borrower, the Collateral Agent’s demands, notices and requests
shall control over those conflicting demands, notices or requests made by the
Borrower.

 

b.                                      The
Contracting Party agrees that it will not terminate or suspend its obligations
under the Assigned Agreement without giving the Collateral Agent concurrent notice
with notice(s) provided the Borrower pursuant to the applicable provisions of
the Assigned Agreement, and, in the case of the termination of obligations, an
opportunity to cure as provided in

 

AA-3

 

paragraph 3(c) below.

 

c.                                       If
(i) the Contracting Party is entitled to terminate the Assigned Agreement for
an event under Sections 16.3, 16.5, 16.6 or 16.7 of the Assigned Agreement
(“Termination Event”), (ii) the Contracting Party desires to terminate its obligations
under the Assigned Agreement, and (iii) notice(s) with respect to clauses (i)
and (ii) shall have been provided to the Collateral Agent by the Contracting
Party as provided in paragraph 3(b) above, then, and in any such case: the
Collateral Agent may elect to exercise its right to cure by providing, within
thirty (30) days after the receipt by it of the notices referred to in the
preceding clause (iii), to the Contracting Party, written notice stating that
the Collateral Agent has elected to exercise such right to cure (or cause to be
cured), together with a written statement of the Collateral Agent that it will
promptly commence to cure (or cause to be cured) all Termination Events
susceptible of being cured (including, as appropriate, by the payment of money
damages), and that it will, during the cure period, diligently attempt in good
faith to complete (or cause to be completed) the curing of, to the reasonable
satisfaction of the Contracting Party, all such Termination Events.  If the Contracting Party is entitled to
suspend performance of the Work for an event under Section 16.4 of the Assigned
Agreement (“Suspension Event”), the Contracting Party may, provided that notice
to the Collateral Agent shall have been provided to the Collateral Agent as
provided in paragraph 3(b) above, suspend performance of the Work in accordance
with the terms of the Assigned Agreement until such time as (a) the Borrower
has cured the Suspension Event or (b) the Collateral Agent has cured (or caused
to be cured) such Suspension Event in accordance with paragraph 3(d).  The preceding sentence shall in no way limit
any rights the Contracting Party may otherwise have to terminate the Assigned
Agreement, subject to the other provisions of this Consent.  Notwithstanding anything to the contrary in
this paragraph 3(c), in no event shall this paragraph 3(c) be interpreted to
change the Contracting Party’s rights to suspend performance of the Work under
the Assigned Agreement or terminate the Assigned Agreement, except to the
extent of the Collateral Agent’s right to effect a cure in accordance with
paragraph 3(c) for a Termination Event or Suspension Event and paragraph 3(d)
for a Termination Event.

 

d.                                      The
Collateral Agent shall have a period equal to forty-five (45) days in the
event of default in payment of undisputed amounts under Section 16.5 of the
Assigned Agreement or ninety (90) days in other cases, after the delivery of
the notice by the Collateral Agent referred to in paragraph 3(c) in which to
cure the Termination Event(s) specified in such notice; provided that if such
cure of any non-payment default can only be effected through a foreclosure on
the Project (as defined in the Security Agreement), then, provided that the
Collateral Agent makes, and continues to make, timely payment to the
Contracting Party of all sums due under the Assigned Agreement, and, subject to
paragraph 3(f) hereof, shall either make current payment to or provide the
Contracting Party with assurance(s) of current payment reasonably satisfactory
to the Contracting Party of all reasonable delay and incremental costs
reasonably incurred by the Contracting Party thereafter, the Collateral Agent
shall have such additional reasonable period of time as is necessary to effect
such foreclosure.  Notwithstanding the
foregoing, no such cure of a payment shall be construed as an assumption by the
Collateral Agent or any Secured Party of any covenants, agreements or
obligations of the Borrower under or in respect of the Assigned Agreement.

 

e.                                       If,
before the Collateral Agent shall have cured any Termination Event

 

AA-4

 

pursuant to paragraph 3(d), the
Borrower shall have cured such Termination Event, the Contracting Party
promptly shall provide the Collateral Agent with notice of such cure and the
discontinuance of such Termination Event.

 

f.                                         In
the event any delay and incremental costs are due and payable to the
Contracting Party under the terms of this Consent, the Contracting Party shall
take all reasonable steps necessary to mitigate such delay and incremental
costs.

 

g.                                      The
Collateral Agent’s right to cure Borrower defaults under the Assigned Agreement
or otherwise take action on behalf of the Borrower under this paragraph 3 shall
not arise until after the initial disbursement of the Secured Parties’ loans.

 

4.

a.                                       Notwithstanding
any provision in the Assigned Agreement to the contrary, in the event of the
rejection or termination of the Assigned Agreement by a receiver of the
Borrower or otherwise pursuant to bankruptcy or insolvency proceedings, then,
provided that the Collateral Agent shall have made payment to the Contracting
Party of all sums due under the Assigned Agreement and, subject to paragraph
3(f) hereof, shall either make current payment to or provide the Contracting
Party with assurance(s) of current payment reasonably satisfactory to the
Contracting Party of all reasonable delay and incremental costs incurred by the
Contracting Party during the period of time required for the following
activities, the Contracting Party will enter into a new agreement with the
Collateral Agent or, at the Collateral Agent’s request, with the Collateral
Agent’s nominee, for the remainder of the originally scheduled term of the
Assigned Agreement, effective as of the date of such rejection, with
substantially the same covenants, agreements, terms, provisions and limitations
as are contained in the Assigned Agreement; provided that the Collateral Agent
shall have made a request to the Contracting Party for such new agreement
within ninety (90) days after the date the Collateral Agent receives notice
from the Contracting Party of the rejection of the Assigned Agreement and
provided further that the Contracting Party shall have been provided assurances
of payment and security for payment reasonably satisfactory to the Contracting
Party.

 

b.                                      If
the Collateral Agent or its nominee is prohibited by any process or injunction
issued by any court having jurisdiction of any bankruptcy or insolvency
proceeding involving the Borrower, from continuing the Assigned Agreement in
place of the Borrower or from otherwise exercising any of its rights or
remedies hereunder or under the Security Agreement in respect of the Assigned
Agreement, then, provided that the Collateral Agent shall have made payment to
the Contracting Party of all sums due under the Assigned Agreement and, subject
to paragraph 3(f) hereof, shall either make current payment to or provide the
Contracting Party with assurance(s) of current payment reasonably satisfactory to
the Contracting Party of all reasonable delay and incremental costs incurred by
the Contracting Party thereafter, the times specified herein for the exercise
by the Collateral Agent of any right or benefit granted to it hereunder
(including without limitation the time period for the exercise of any cure
rights granted hereunder) shall be extended for the period of such prohibition;
provided that the Collateral Agent is diligently pursuing such rights or
remedies (to the extent permitted) in such bankruptcy or insolvency proceeding
or otherwise.

 

AA-5

 

c.                                       The
Collateral Agent shall not take action under this paragraph 4 until after the
initial disbursement of the Secured Parties’ loans.

 

5.                     Provided that
an event of default by Borrower shall have occurred and be continuing pursuant
to the loan documents executed in accordance with the Security Agreement, the
Contracting Party agrees that the Collateral Agent may (but shall not be
obligated to) pursuant to the terms of the Security Agreement assume, or cause
any purchaser at any foreclosure sale or any assignee or transferee under any
instrument of assignment or transfer in lieu of foreclosure to assume, all of
the interests, rights and all of the obligations of the Borrower thereafter
arising under the Assigned Agreement, provided that as conditions precedent to
or concurrent with any such assignment or transfer, (a) the Collateral Agent
shall have made or caused to be made payment to the Contracting Party of all sums
due hereunder or under the Assigned Agreement, and, subject to paragraph 3(f)
hereof, all reasonable delay and incremental costs incurred by the Contracting
Party during the period of time preceding such assignment or transfer, if any,
and (b) the assuming party shall have executed an agreement in writing to be
bound by and to assume all of the obligations to the Contracting Party arising
or accruing thereunder from and after the date of such assumption, and shall
have provided the Contracting Party with assurances of future payment and
security for future payment reasonably satisfactory to the Contracting
Party.  If the interests, rights and
obligations of the Borrower in the Assigned Agreement shall be assumed, sold or
transferred as provided herein, then the Contracting Party shall continue to
perform its obligations under the Assigned Agreement in favor of the assuming
party as if such party had thereafter been named as the Borrower under the
Assigned Agreement; provided that if the Collateral Agent (or any entity acting
on behalf of the Collateral Agent or any of the other Secured Parties) assumes
the Assigned Agreement as provided above, such party shall not be liable for
the performance of the obligations thereunder except to the extent of all of its
right, title and interest in and to the Project (as defined in the Security
Agreement).  Notwithstanding any such
assumption or disposition by the Collateral Agent, a purchaser, an assignee or
a transferee, the Borrower shall not be released or discharged from and shall
remain liable for any and all of its obligations to the Contracting Party
arising or accruing under the Assigned Agreement prior to such assumption and
the Contracting Party retains all rights under the Assigned Agreement relating
to any breach thereof by the Borrower or the assuming party.  The Collateral Agent shall not take action
under this paragraph 5 until after the initial disbursement of the Secured
Parties’ loans.

 

6.                     The
Contracting Party shall make all payments due to the Borrower under the
Assigned Agreement to [                    ],
acting as the Collateral Agent to Account No. [                    ],
ABA No. [                    ].  All parties hereto agree that each payment by
the Contracting Party to the Collateral Agent of amounts due to the Borrower
from the Contracting Party under the Assigned Agreement shall satisfy the
Contracting Party’s corresponding payment obligation under the Assigned
Agreement.

 

7.                     Except for
Change Orders (as defined in the Assigned Agreement), no amendment or
modification of, or waiver by or consent of, the Borrower in respect of, any
provision of the Assigned Agreement shall be effective unless the same shall be
in writing, in accordance with the requirements of the Assigned Agreement,
prior written notice thereof shall have been given to the Collateral Agent and
the Collateral Agent shall have given its consent.  No Change Order shall be effective unless the
same shall be in writing, in accordance with the requirements of the Assigned

 

AA-6

 

Agreement, prior written notice
thereof shall have been given to the Collateral Agent and the Collateral Agent
shall have given its consent, provided that (i) in the case of any one Change
Order, prior written notice to and consent by the Collateral Agent is not
required if such Change Order would result in an increase in the Contract Price
(as defined in the Assigned Agreement) in an amount less than Five Million U.S.
Dollars (U.S.$5,000,000) or (ii) in the case of a Change Order in conjunction
with other Change Orders, prior written notice to and consent by the Collateral
Agent of such Change Order is not required if such Change Orders would in
themselves result in an increase in the Contract Price in an amount less than
Fifteen Million U.S. Dollars (U.S.$15,000,000), and provided further that the
foregoing shall not impair any rights the Contracting Party may have to any
Change Order under the Assigned Agreement. This Consent may be amended or
modified only by an instrument in writing signed by the Contracting Party, the
Borrower and the Collateral Agent.

 

8.                     The
Contracting Party shall deliver to the Collateral Agent concurrently with the
delivery thereof to the Borrower, a copy of the following items if and when
provided by the Contracting Party to the Borrower pursuant to the Assigned
Agreement: (a) notification prior to cancellation, non-renewal or a material
change in the insurance coverage required under the terms of the Assigned
Agreement; (b) notification of termination; (c) notification of suspension of
all of the Work; (d) notification of default by the Borrower; (e) notification
of claims, demands, actions or causes of actions asserted against the
Contracting Party for which the Borrower has indemnification obligations; and
(f) notification of request for arbitration.

 

9.                     The
Contracting Party shall provide to the Collateral Agent any information or
documentation as reasonably requested by the Collateral Agent in connection
with the financing of the Borrower’s obligations under the Assigned Agreement
including, without limitation, the following: (a) an opinion of counsel of
Contracting Party customary for a project financing with respect to the
authorization, execution, delivery and enforceability, and other similar
issues, of the Assigned Agreement and this Consent; (b) a certificate of an
authorized officer of Contracting Party certifying that (i) all amounts
due and payable under the Assigned Agreement have been paid other than those
amounts payable in respect of the current invoice and (ii) no event or
condition exists to the Contracting Party’s current actual knowledge which
constitutes a default by the Borrower under the Assigned Agreement; and (c) a
copy of a certificate of good standing of, and payment of franchise taxes by,
the Contracting Party issued by the Secretary of State of Nevada.

 

10.               Notice to any party
hereto shall be deemed to be delivered on the earlier of: (a) the date of
personal delivery and (b) if deposited in a United States Postal Service
depository, postage prepaid, registered or certified mail, return receipt
requested, addressed to such party at the address indicated below (or at such
other address as such party may have theretofore specified by written notice
delivered in accordance herewith), upon delivery or refusal to accept delivery,
in each case as evidenced by the return receipt:

 

AA-7

 

	
  The Collateral Agent:

  	
   

  	
  HSBC Bank USA, National Association

  
	
   

  	
   

  	
  452 Fifth Avenue

  
	
   

  	
   

  	
  New York, NY 10018

  
	
   

  	
   

  	
  Facsimile: [                    ]

  
	
   

  	
   

  	
  Attn: [                            ]

  
	
   

  	
   

  	
   

  
	
  The Borrower:

  	
   

  	
  Sabine Pass LNG, L.P.

  
	
   

  	
   

  	
  717 Texas Avenue, Suite 3100

  
	
   

  	
   

  	
  Houston, Texas 77002

  
	
   

  	
   

  	
  Facsimile: (713) 659-5459

  
	
   

  	
   

  	
  Attn: Ed Lehotsky

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Sabine Pass LNG, L.P.

  
	
   

  	
   

  	
  717 Texas Avenue, Suite 3100

  
	
   

  	
   

  	
  Houston, Texas 77002

  
	
   

  	
   

  	
  Facsimile: (713) 659-5459

  
	
   

  	
   

  	
  Attn: General Counsel

  
	
   

  	
   

  	
   

  
	
  The Contracting Party:

  	
   

  	
  Bechtel Corporation

  
	
   

  	
   

  	
  3000 Post Oak Boulevard

  
	
   

  	
   

  	
  Houston, Texas 77056

  
	
   

  	
   

  	
  Facsimile: (713) 253-1610

  
	
   

  	
   

  	
  Attn: C. Asok Kumar

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Bechtel Corporation

  
	
   

  	
   

  	
  3000 Post Oak Boulevard

  
	
   

  	
   

  	
  Houston, Texas 77056

  
	
   

  	
   

  	
  Facsimile: (713) 235-3945

  
	
   

  	
   

  	
  Attn: Principal Counsel

  

 

11.               This Consent shall
be binding upon and shall inure to the benefit of the respective successors and
permitted assigns of the Contracting Party, the Borrower, the Collateral Agent
and the Secured Parties (provided, however, that the Contracting Party shall
not assign or transfer it rights hereunder without the prior written consent of
the Collateral Agent).

 

12.               This Consent may be
executed in one or more counterparts with the same effect as if the signatures
thereto and hereto were upon the same instrument.  This Consent shall become effective at such
time as the Collateral Agent shall have received counterparts hereof signed by
all of the intended parties hereto.

 

13.               For purposes of
this Consent, the term “day” or “days” shall mean calendar days unless
otherwise defined herein.

 

AA-8

 

14.               No failure on the
part of any party or any of its agents to exercise and no delay in exercising,
and no course of dealing with respect to, any right, power or privilege
hereunder shall operate as a waiver thereof (subject to any statute of
limitations), and no single or partial exercise of any right, power or
privilege hereunder shall preclude any other or further exercise thereof or the
exercise of any other right power or privilege.

 

15.               If any provision
hereof is invalid and unenforceable in any jurisdiction, then, to the fullest
extent permitted by law, (a) the other provisions hereof shall remain in full
force and effect in such jurisdiction and shall be liberally construed to carry
out the intentions of the parties hereto as nearly as may be possible and (b)
the invalidity or unenforceability of any provision hereof in any jurisdiction
shall not affect the validity or enforceability of such provision in any other
jurisdiction.

 

16.               The agreements of
the parties hereto are solely for the benefit of the Contracting Party, the
Borrower, the Collateral Agent and the Secured Parties, and no Person (other
than the parties hereto and the Secured Parties and their successors and
assigns permitted hereunder) shall have any rights hereunder.

 

17.               This Consent shall
terminate upon the indefeasible payment in full of all amounts owed in
connection with the Security Agreement.

 

18.               THIS CONSENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. THE CONTRACTING
PARTY, THE COLLATERAL AGENT AND THE BORROWER HEREBY SUBMIT TO THE NONEXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN NEW YORK CITY FOR THE
PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS CONSENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY, EXCEPT FOR DISPUTES ARISING OUT OF OR
RELATING TO THE ASSIGNED AGREEMENT WHICH WILL CONTINUE TO BE GOVERNED
EXCLUSIVELY BY ARTICLE 18 OF THE ASSIGNED AGREEMENT.  THE CONTRACTING PARTY, THE COLLATERAL AGENT
AND THE BORROWER IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY
SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 

19.               EACH OF THE CONTRACTING PARTY, THE COLLATERAL
AGENT AND THE BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS CONSENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

 

20.               NOTWITHSTANDING ANY OTHER PROVISIONS OF THIS
AGREEMENT, NONE OF THE CONTRACTING PARTY, THE COLLATERAL AGENT, NOR THE BORROWER,
SHALL BE LIABLE UNDER THIS CONSENT, WHETHER IN CONTRACT,

 

AA-9

 

WARRANTY, TORT (INCLUDING
NEGLIGENCE), STRICT LIABILITY, PRODUCTS LIABILITY, PROFESSIONAL LIABILITY,
INDEMNITY, CONTRIBUTION, OR ANY OTHER CAUSE OF ACTION FOR SPECIAL, INDIRECT,
INCIDENTAL OR CONSEQUENTIAL LOSSES OR DAMAGES, INCLUDING LOSS OF PROFITS, LOSS
OF USE, LOSS OF OPPORTUNITY, LOSS OF REVENUES, LOSS OF FINANCING, LOSS OR
INCREASE OF BONDING CAPACITY, COSTS OF OBTAINING OR MAINTAINING FINANCING, LOSS
OF GOODWILL, OR BUSINESS INTERRUPTION, OR DAMAGES OR LOSSES FOR PRINCIPAL
OFFICE EXPENSES INCLUDING COMPENSATION OF PERSONNEL STATIONED THERE
(“CONSEQUENTIAL DAMAGES”), AND THE CONTRACTING PARTY, THE COLLATERAL AGENT, AND
THE BORROWER DO HEREBY RELEASE EACH OTHER FROM ANY LIABILITY FOR SUCH
CONSEQUENTIAL DAMAGES; PROVIDED THAT THE EXCLUSION OF LIABILITY SET FORTH IN
THIS SECTION IS NOT INTENDED TO PRECLUDE RECOVERIES AS PERMITTED PURSUANT TO
SECTION 20.4 OF THE ASSIGNED AGREEMENT WITH RESPECT TO OBLIGATIONS UNDER THE
ASSIGNED AGREEMENT ONLY.

 

[Signature page follows.]

 

AA-10

 

IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Consent as of the                 
day of                                 ,
20    .

 

	
  HSBC BANK USA, NATIONAL ASSOCIATION

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  BECHTEL CORPORATION

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  ACKNOWLEDGED and AGREED

  	
   

  
	
   

  	
   

  
	
  SABINE PASS LNG, L.P.

  	
   

  
	
   

  	
   

  
	
   

  	
  By: Sabine Pass LNG-LP, Inc., its General Partner

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
														

 

AA-11

 

ATTACHMENT BB

 

FORM OF CONTRACTOR
AND OWNER CONFIRMATIONS

 

BB-1

 

SCHEDULE BB-1

 

FORM OF
CONTRACTOR QUARTERLY CONFIRMATION

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Facsimile: (713) 659-5459

Attn: Ed Lehotsky

 

Re:                               Contractor
Quarterly Confirmation

 

I confirm that Bechtel
Corporation was in compliance with the covenants on its credit facilities
during the fiscal quarter ended                                   ,
200    .

 

As of the date of this
confirmation and so far as I am aware, Bechtel Corporation has kept its Books and Records in accordance with generally accepted accounting principles and
has the financial resources available to it such as to enable Bechtel
Corporation to continue to perform its obligations under the Lump Sum Turnkey
Agreement for the Engineering, Procurement and Construction of the
Sabine Pass LNG Receiving, Storage and
Regasification Terminal dated December 18, 2004. This confirmation shall not be
construed in any way such as to relieve Sabine Pass LNG, L.P. from its obligations and liabilities under
such Lump Sum Turnkey Agreement.

 

This confirmation is
prepared expressly and exclusively for the use and benefit of Sabine
Pass LNG, L.P. and its Lenders.

 

 

	
   

  	
   

  
	
  Signature and Title of
  Appropriate Senior Officer of Bechtel Corporation

  
	
   

  
	
   

  	
   

  
	
  Date

  

 

 

cc.                                 Sabine Pass LNG, L.P.

717 Texas Avenue, Suite 3100

Houston, Texas 77002

Attn: General Counsel

 

BB-2

 

SCHEDULE BB-2

 

FORM OF
OWNER MONTHLY CONFIRMATION

 

 

Bechtel Corporation

3000 Post Oak Boulevard

Houston, Texas 77056

Attn: C. Asok Kumar

 

Re:                               Owner Monthly Confirmation

 

As of the date of this
confirmation and so far as I am aware, Sabine Pass LNG, L.P. has
sufficient funds to continue to fulfill its payment obligations under the Lump Sum Turnkey Agreement for the
Engineering, Procurement and Construction of the Sabine Pass LNG Receiving, Storage and Regasification
Terminal dated December 18, 2004, up to the date of the First Draw, and
no event has come to the attention of Sabine Pass LNG, L.P. which would
materially and adversely affect the continued availability of such funding.  This
confirmation shall not be construed in any way such as to relieve Bechtel
Corporation from its obligations and
liabilities under such Lump Sum Turnkey Agreement.

 

This confirmation is
prepared expressly and exclusively for the use and benefit of Bechtel
Corporation.

 

 

	
   

  	
   

  
	
  Signature and Title of
  Appropriate Senior Officer of Sabine Pass LNG, L.P.

  
	
   

  
	
   

  	
   

  
	
  Date

  

 

 

cc:                                 Bechtel
Corporation

3000 Post Oak Boulevard

Houston, Texas 77056

Attn: Principal Counsel

 

BB-3

 

SCHEDULE BB-3

 

FORM OF
OWNER QUARTERLY CONFIRMATION

 

 

Bechtel Corporation

3000 Post Oak Boulevard

Houston, Texas 77056

Attn: C. Asok Kumar

 

Re:                               Owner Quarterly Confirmation

 

As of the date of this
confirmation and so far as I am aware, Sabine Pass LNG, L.P. has
sufficient funds through itself or financing to continue to fulfill its payment
obligations under the Lump Sum
Turnkey Agreement for the Engineering, Procurement and Construction of the
Sabine Pass LNG Receiving, Storage and
Regasification Terminal dated December 18, 2004, and no event has come
to the attention of Sabine Pass LNG, L.P. which would materially and adversely
affect the continued availability of such funding.  This confirmation shall not be
construed in any way such as to relieve Bechtel Corporation from its obligations and liabilities under
such Lump Sum Turnkey Agreement.

 

This confirmation is
prepared expressly and exclusively for the use and benefit of Bechtel
Corporation.

 

 

	
   

  	
   

  
	
  Signature and Title of
  Appropriate Senior Officer of Sabine Pass LNG, L.P.

  
	
   

  
	
   

  	
   

  
	
  Date

  

 

 

cc:                                 Bechtel
Corporation

3000 Post Oak Boulevard

Houston, Texas 77056

Attn: Principal Counsel

 

BB-4

 

ATTACHMENT CC

 

INDEPENDENT
ENGINEER ACTIVITIES

 

Owner has overall responsibility to
coordinate the activities of Independent Engineer, including but not limited to,
(i) arranging visits to Contractor’s offices and to the Site, (ii) forwarding
relevant Project reports and documentation to Independent Engineer, and (iii)
transmitting comments and feedback, if any, from Independent Engineer to
Contractor.  Independent Engineer
shall comply with all Site safety programs in effect while on the Site.  With respect to the activities of Independent
Engineer, Owner is responsible for the actions of Independent Engineer.

 

Independent Engineer shall not be entitled to issue any instruction or
directive to Contractor or any of its Subcontractors or Sub-subcontractors in
connection with performance of the Work. 
Contractor shall
reasonably cooperate with Independent Engineer in the conduct of his or her
duties in relation to the Facility and the Work, including but not limited to,
the activities of Independent Engineer set forth below:

 

1.               Review all Drawings and Specifications
provided by Contractor to Owner. 
Contractor shall provide to Independent Engineer a set of Record Drawings
and Specifications.

 

2.               Conduct quarterly Site visits, including:

 

a.               Evaluation of the progress of the Work
against the Milestones set forth in Attachment C, Schedule C-1
and the CPM Schedule;

 

b.              Observation of general standard of
workmanship and performance of spot checks of Contractor’s quality records;

 

c.               Review of Owner’s audits of Contractor’s
quality system;

 

d.              Review of incurred and potential delays and
proposed Recovery Schedule, if any;

 

e.               Review of Contractor Permits obtained and
assessment of Contractor’s ability to obtain outstanding Contractor Permits;

 

f.                 Review and report on Contractor’s health,
safety and environmental compliance programs;

 

g.              Evaluation of lost time incidents, if any;

 

h.              Review of Contractor’s waste management and effluent
discharge practices; and

 

i.                  Assessment of Contractor’s  implementation of socio-economic and environmental offset
programs required under the environmental impact assessment report submitted
for FERC approval.

 

3.               Verify Contractor’s achievement of each
Milestone (including achievement of RFCD, Substantial Completion and Final
Completion).

 

CC-1

 

4.               Review Monthly Progress Reports.

 

5.               Monitor and review Change Order requests.

 

6.               Monitor Performance Tests and confirm
satisfaction of Performance Guarantees.

 

7.               Review all necessary reports and data
associated with the pre-commissioning and commissioning of the Facility.

 

8.               Review Contractor’s proposed Performance Test
plans and procedures and confirm compliance with Performance Test criteria
specified in Attachment S, Applicable Codes and Standards, Applicable
Law, Equipment manufacturers’ recommendations, GECP, and loan documents with
Lender.

 

9.               Witness Performance Tests, including:

 

a.               Observation of data collection procedures,
instrumentation calibration and operating and testing personnel during the
Performance Tests;

 

b.              Verification of Performance Testing results
and calculations used to adjust for relevant conditions;

 

c.               Verification of compliance of operational and
regulatory requirements with Agreement requirements, as well as Permits;

 

d.              Random verification of proper operation of
Equipment and calibration of measurement and control systems;

 

e.               Verification that measurement and control systems
have no overrides;

 

f.                 Evaluation of compliance with Performance
Guarantees and, if applicable, calculation of Liquidated Damage payments;

 

g.              Review and comment to Owner on Contractor’s
Performance Test reports; and

 

h.              Verification of data collection and
calculation procedures used to adjust Performance Test results to the
Performance Guarantee conditions set forth in Attachment T of the
Agreement.

 

10.         Verify that Punchlist items are complete in all material respects.

 

11.         Sign and submit the RFCD Completion Certificate, Substantial Completion
Certificate and the Final Completion Certificate confirming that all conditions
of RFCD, Substantial Completion and Final Completion, as the case may be, have
been achieved.

 

12.         Monitor completion of Punchlist items.

 

CC-2

 

ATTACHMENT DD

 

FORM OF
ESCROW AGREEMENT

 

THIS ESCROW AGREEMENT  (this
“Escrow Agreement”) is entered into
as of [                      ],
2004 (the “Effective Date”) by and among
SABINE PASS LNG, L.P., a Delaware
limited partnership (“Owner”),
and BECHTEL CORPORATION, a Nevada
corporation, (“Contractor” and, together
with Owner, each a “Party” and, collectively, the
“Parties”), and [NAME OF ESCROW AGENT], a [jurisdiction] State bank with an office in [city], [          ]
County, [          ]
(“Escrow Agent”). Capitalized terms
used, but not otherwise defined, herein shall have the respective meanings
ascribed to such terms in the EPC Agreement (as defined below).

 

W I T N E
S S E T H :

 

WHEREAS, pursuant
to the terms of the Lump Sum Turnkey Agreement for the Engineering, Procurement
and Construction of the Sabine Pass  LNG Receiving,
Storage and Regasification Terminal, dated as of December 18, 2004, by and
between Owner and Contractor (the “EPC Agreement”),
Contractor will provide services for the engineering, procurement,
construction, commissioning, start-up and testing of the Facility; and

 

WHEREAS, pursuant
to Section 18.4 of the EPC Agreement, Owner has the obligation, in certain
circumstances, to deliver the Escrow Funds (as defined below) to be set aside
in the Escrow Account pursuant to the terms of this Escrow Agreement; and

 

WHEREAS, Owner and Contractor have mutually agreed upon
and selected Escrow Agent to serve as the escrow agent for the Escrow Funds
subject to the terms and conditions of this Escrow Agreement; and

 

WHEREAS, Escrow
Agent is willing to serve in such capacity subject to the terms and conditions
of this Escrow Agreement.

 

NOW, THEREFORE, in consideration of the premises and mutual
covenants and agreements contained herein, the Parties and Escrow Agent,
intending to be legally bound, agree as follows:

 

1.                                       Appointment of Escrow Agent.  Owner
and Contractor hereby appoint and designate [Name of
Escrow Agent] as escrow agent to receive, hold, administer,
invest and disburse the Escrow Funds in accordance with the terms of this
Escrow Agreement.  Escrow Agent hereby
accepts its appointment as Escrow Agent and agrees to hold, administer, invest
and disburse the Escrow Funds in accordance with the terms of this Escrow
Agreement.

 

2.                                       Delivery
of the Escrow Funds.  Pursuant to
Section 18.4 of the EPC Agreement, Owner and Contractor have agreed that Owner
shall have the obligation in certain circumstances to deliver by wire transfer
to Escrow Agent certain sums to be held by Escrow Agent in accordance with the
terms of this Escrow Agreement (the “Escrow Funds”).  Subject to and in accordance with the terms
and conditions hereof, Escrow Agent agrees that it shall receive, hold in
escrow, invest and reinvest, and release or disburse the Escrow Funds.  It is hereby expressly stipulated and agreed
that all interest and other earnings on the Escrow Funds shall be added to and
become a part of the Escrow Funds for all purposes, and that all losses
resulting from the

 

DD-1

 

investment or reinvestment thereof from time to time and any amounts
which may be charged thereto in accordance with Section 10 to compensate or
reimburse Escrow Agent from time to time for amounts owing to it hereunder
shall from the time of such loss or charge no longer constitute part of the
Escrow Funds.

 

3.                                       Investment
of the Escrow Funds.  Escrow Agent
shall invest and reinvest the Escrow Funds in short-term U.S. government notes
maturing within thirty (30) calendar days
(“Days”), as determined by the Escrow
Agent.  It is understood and agreed that
the Escrow Agent or its affiliates are permitted to receive additional
compensation that could be deemed to be in the Escrow Agent’s economic
self-interest for (i) serving as investment advisor, administrator, shareholder
servicing agent, custodian or sub-custodian with respect to certain of the
investments; (ii) using affiliates to effect transactions in certain
investments; and (iii) effecting transactions in investments.

 

Receipt, disbursement, investment and reinvestment of the Escrow Funds
shall be confirmed by Escrow Agent within thirty (30)  Days  of such receipt, disbursement, investment or reinvestment
by an account statement delivered to the Parties by Escrow Agent, and any
discrepancies in any such account statement shall be noted by the Parties to
Escrow Agent within thirty (30) Days after receipt thereof.  Failure to inform Escrow Agent in writing of
any discrepancies in any such account statement within said thirty (30)-Day
period shall be presumed to constitute confirmation of such account statement
in its entirety.  For purposes of this
paragraph, each account statement shall be deemed to have been received by the
Party to whom directed on the earlier to occur of (i) actual receipt thereof
and (ii) three (3) Business Days after the deposit thereof in the United States
Mail, postage prepaid.  The term “Business Day” shall mean any day of
the year, excluding Saturday, Sunday and any other day on which banks are
required or authorized to close in Houston, Texas.

 

4.                                       Release
of the Escrow Funds.  Escrow Agent
shall disburse the Escrow Funds to Owner or Contractor, or their assigned
representatives, only upon the following conditions and/or circumstances:

 

(a)                                  Escrow
Agent shall disburse the Escrow Funds, in whole or in part, as directed by
Owner and Contractor in a notarized writing in substantially the form of Exhibit
1, attached hereto (“Joint Notice”),
executed by authorized representatives of Owner and Contractor and setting
forth, at a minimum, (i) the amount of the Escrow Funds (plus accrued interest)
to be disbursed, (ii) the percentage allocation of the Escrow Funds (plus
accrued interest) to be disbursed between Owner and Contractor, and (iii) the
timing of when the disbursement shall occur; OR,

 

(b)                                 Escrow
Agent shall disburse the Escrow Funds, in whole or in part, as directed by
Owner in a notarized writing delivered to Escrow Agent (with a copy by
facsimile and registered mail to Contractor), in substantially the form of Exhibit
2, attached hereto (“Owner’s Notice”),
setting forth, at a minimum, (i) the amount of the Escrow Funds (plus accrued
interest) to be disbursed and (iii) the timing of when the disbursement shall
occur; provided that Contractor has not
provided its objection in writing to Escrow Agent (with a copy by facsimile and
registered mail provided to Owner) (“Objection Notice”)
within sixty (60) Days of receipt of Owner’s Notice, such Objection Notice setting
forth in reasonable detail Contractor’s rationale for objecting to the
disbursement terms set forth in Owner’s Notice; OR

 

DD-2

 

(c)                                  Escrow
Agent shall disburse the Escrow Funds, if any, upon Escrow Agent’s receipt of a
court order or other legal and binding directive (including but not limited to
a binding order from an arbitrator and any decision by an arbitration panel or
arbitrator within the scope of Section 18.2 of the EPC Agreement) requiring Escrow
Agent to disburse such Escrow Funds in accordance with the terms of such court
order or directive, irrespective of whether such court order or other legal and
binding directive or arbitration decision is subject to appeal or has been
appealed.

 

5.                                       Interest.  Upon disbursement of the Escrow Funds
pursuant to Section 4 or hereof, any interest accrued on such Escrow Funds
shall be disbursed to Owner.

 

6.                                       Tax
Matters.  Through execution of this
Escrow Agreement, Owner and Contractor hereby each provide Escrow Agent with
their respective taxpayer identification number documented on the signature
page of this Escrow Agreement.  Owner and
Contractor shall provide Escrow Agent with the taxpayer identification
number(s) of any recipient, other than Escrow Agent, of funds to be disbursed
from the Escrow Funds.  Owner and
Contractor understand that the failure to provide such information as to any
recipient may prevent or delay disbursements from the Escrow Funds and may also
result in the assessment of a penalty and Escrow Agent’s being required to
withhold tax on any interest or other income earned on the Escrow Funds.  Any payments of income shall be subject to
applicable withholding regulations then in force in the United States or any
other jurisdiction, as applicable. 
Solely for purposes of ensuring the regular payment of taxes upon Escrow
Funds, the Parties agree that Owner shall be treated as the owner of the Escrow
Funds for federal and state income tax purposes and that Owner shall include in
taxable income the earnings on the Escrow Funds.

 

7.                                       Limited
Liability of Escrow Agent.  In
performing its duties under this Escrow Agreement or upon the claimed failure
to perform its duties hereunder, Escrow Agent shall have no liability except
for Escrow Agent’s willful misconduct or gross negligence.  The Escrow Agent’s sole responsibility shall
be for the safekeeping and disbursement of the Escrow Funds in accordance with
the terms of this Escrow Agreement.  The
Escrow Agent shall have no implied duties or obligations and shall not be
charged with knowledge or notice of any fact or circumstance not specifically
set forth herein or in any notice given to it under this Escrow Agreement in
accordance with Section 11 hereof.  The Escrow
Agent shall be entitled to rely upon and shall be protected in acting upon any
request, instructions, statement or other instrument, not only as to its due
execution, validity and effectiveness, but also as to the truth and accuracy of
any information contained therein, which Escrow Agent shall in good faith
believe to be genuine, to have been signed or presented by the Person or
Parties purporting to sign the same and to conform to the provisions of this
Escrow Agreement.  In no event shall
Escrow Agent be liable for incidental, indirect, special, consequential or
punitive damages.  The Escrow Agent shall
not be obligated to take any legal action or to commence any proceeding in
connection with the Escrow Funds or to appear in, prosecute or defend any such
legal action or proceedings.  The Escrow
Agent may consult legal counsel selected by it in the event of any dispute or
question as to the construction of any of the provisions hereof or of any other
agreement or of its duties hereunder, and shall incur no liability and shall be
fully protected from any liability whatsoever in acting in accordance with the
opinion or instruction of such counsel. 
Owner and Contractor, jointly and severally, shall promptly pay, upon
demand (in accordance

 

DD-3

 

with the procedures set forth in Section 10 hereof), the reasonable
fees and expenses of any such counsel; provided, however,
Owner and Contractor agree that such fees and expenses shall be borne equally
between Owner and Contractor.  The Escrow
Agent shall have no obligations or responsibilities in connection with the EPC
Agreement, or any other agreement between the Parties, other than this Escrow
Agreement.

 

8.                                       Right
of Interpleader.  Should any
controversy arise involving the Parties and Escrow Agent, or any of them or any
other person, firm or entity with respect to this Escrow Agreement or the
Escrow Funds, or should a substitute escrow agent fail to be designated as
provided in Section 14 hereof, or if Escrow Agent should be in doubt as to what
action to take, Escrow Agent shall have the right, but not the obligation,
either to (i) withhold delivery of the Escrow Funds until the controversy is
resolved, the conflicting demands are withdrawn or its doubt is resolved or
(ii) institute a petition for interpleader in a court in Harris County, Texas
to determine the rights of the Parties and Escrow Agent.  Should a petition for interpleader be
instituted, or should Escrow Agent be threatened with litigation or become involved
in litigation in any manner whatsoever in connection with this Escrow Agreement
or the Escrow Funds, Owner and Contractor hereby jointly and severally agree to
reimburse Escrow Agent for its reasonable attorneys’ fees and any and all other
reasonable expenses, losses, costs and damages incurred by Escrow Agent in
connection with or resulting from such threatened or actual litigation prior to
any disbursement hereunder, except to the extent that any such expense, loss,
cost or damage results from the willful misconduct or gross negligence of
Escrow Agent.

 

9.                                       Exculpation
of Escrow Agent.  It is agreed that
the duties of Escrow Agent are herein specifically provided and are purely
ministerial in nature, and that Escrow Agent shall incur no liability
whatsoever except for its willful misconduct or gross negligence, so long as
Escrow Agent is acting in good faith. 
The Parties do hereby release Escrow Agent from any liability for any
error or judgment or for any act done or omitted to be done by Escrow Agent in
good faith performance of its duties hereunder and do each, jointly and
severally, indemnify Escrow Agent against, and agree to hold harmless, save and
defend Escrow Agent from, any costs, liabilities, and expenses incurred by
Escrow Agent in serving as Escrow Agent hereunder and in faithfully discharging
its duties and obligations hereunder.

 

10.                                 Compensation
and Reimbursement of Expenses.  The
Parties shall compensate Escrow Agent for its services hereunder in accordance
with Exhibit 3 attached hereto and, in addition, shall reimburse Escrow
Agent for all of its reasonable out-of-pocket expenses incurred in the
performance of its duties and enforcement of its rights hereunder and otherwise
in connection with the preparation, operation, administration and enforcement
of this Escrow Agreement, including, without limitation, attorneys’ fees,
brokerage costs  and related expenses incurred by
Escrow Agent (collectively, the “Fees”).  All of the compensation and reimbursement
obligations set forth in this Section 10 shall be payable within ten (10)
Business Days following the Parties’ receipt of notice from Escrow Agent that
such payment should be made.  The Parties
agree that the Fees shall be borne equally by the Parties and the Fees may be
deducted from the Escrow Funds.  Solely
in the event and to the extent that the Parties shall have failed to provide
payment to Escrow Agent within the ten (10) Business Day period set forth in
the preceding sentence, Escrow Agent is authorized to disburse to itself from
the Escrow Funds the amount(s) not paid, subject to Escrow Agent’s restoration
of such payment to the Escrow

 

DD-4

 

Funds should the applicable payment be later received by Escrow Agent.

 

11.                                 Notices.  All notices, communications and deliveries under
this Escrow Agreement will be made in writing signed by or on behalf of the
party making the same, will specify the Section under this Escrow Agreement
pursuant to which it is given or being made, and will be delivered (i) by
facsimile, (ii) by personal delivery or (iii) by express air courier, return
receipt requested (with evidence of delivery and postage and other fees
prepaid) as follows:

 

If to Escrow Agent:

 

[Name of
Escrow Agent]

[Address]

Attn:  [                                                                ]

Facsimile:  [                                                        ]

Telephone No.:  [                                               ]

 

If to Owner:

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Facsimile: (713) 659-5459

Attn: Ed Lehotsky

 

with a copy to:

 

Sabine Pass LNG, L.P.

717 Texas Avenue, Suite
3100

Houston, Texas 77002

Facsimile: (713) 659-5459

Attn: General Counsel

 

If to Contractor:

 

Bechtel Corporation

3000 Post Oak Boulevard

Houston, Texas 77056

Facsimile: (713) 253-1610

Attn: C. Asok Kumar

 

with a copy to:

 

Bechtel Corporation

3000 Post Oak Boulevard

Houston, Texas 77056

 

DD-5

 

Facsimile: (713) 235-3945

Attn: Principal Counsel

 

Except to the extent otherwise
provided in the second paragraph of Section 3 herein, delivery of any
communication given in accordance herewith shall be effective only upon actual
receipt thereof by the party or parties to whom such communication is directed.  The Parties or Escrow Agent may change the
address to which communications hereunder are to be directed by giving written
notice to the other parties hereto in the manner provided in this Section 11.
All signatures of the parties to this Escrow Agreement may be transmitted by
facsimile, and such facsimile will, for all purposes, be deemed to be the
original signature of such party whose signature it reproduces, and will be
binding upon such party.

 

12.                                 Authorization.  Each Party to this Agreement, on behalf of
itself and the Escrow Agent, on behalf of itself, acknowledges and represents
that the signatories for each Party and the Escrow Agent to this Escrow
Agreement have the requisite authorization to bind the Parties and Escrow Agent
hereto.

 

13.                                 Choice
of Laws; Cumulative Rights.  This
Escrow Agreement shall be governed by, and construed in accordance with, the
laws of the state of Texas, without giving effect to the principles thereof
relating to conflicts of law.  All of
Escrow Agent’s rights hereunder are cumulative of any other rights it may have
at law, in equity or otherwise.  The
Parties and Escrow Agent agree that the forum for resolution of any dispute
arising under this Escrow Agreement shall be in a court in Harris County, Texas.

 

14.                                 Resignation
or Removal of Escrow Agent.  Escrow
Agent may resign from the performance of its duties hereunder at any time by
providing thirty (30) Days’ prior written notice to Owner and Contractor or may
be removed, with or without cause, by Owner and Contractor, acting jointly, at
any time by providing thirty (30) Days’ prior written notice to Escrow
Agent.  Such resignation or removal shall
take effect upon the appointment of a successor escrow agent as provided
herein.  Upon any such notice of
resignation or removal, Owner and Contractor, acting jointly, shall appoint a
successor escrow agent hereunder, which shall be a commercial bank, trust
company or other financial institution with a combined capital and surplus in
excess of $100,000,000, unless otherwise agreed by Owner and Contractor as
evidenced by written instructions executed by Owner and Contractor.  Upon the acceptance in writing of any
appointment as Escrow Agent hereunder by a successor escrow agent: (i) the
retiring Escrow Agent shall deliver the Escrow Funds to the successor escrow
agent, (ii) such successor escrow agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Escrow Agent, and (iii) the retiring Escrow Agent shall be discharged from its
duties and obligations under this Escrow Agreement, but shall not be discharged
from any liability for actions taken as Escrow Agent hereunder prior to such
succession.  After any retiring Escrow
Agent’s resignation or removal, the provisions of this Escrow Agreement shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Escrow Agent under this Escrow Agreement.  If Owner and Contractor fail to designate a
substitute escrow agent within ten (10) Business Days after receiving a notice
of Escrow Agent’s resignation or delivering to Escrow Agent a notice of
removal, Escrow Agent may institute a petition for interpleader.  Escrow Agent’s sole responsibility after such
ten (10)

 

DD-6

 

Business Day notice period expires shall be to hold the Escrow Funds
(without any obligation to reinvest the same) and to deliver the same to a
designated substitute escrow agent, if any, or in accordance with the
directions of a final order or judgment of a court of competent jurisdiction,
at which time of delivery Escrow Agent’s obligations hereunder shall cease and
terminate.

 

15.                                 Assignment.  This Escrow Agreement shall not be assigned
without the prior written consent of the non-assigning party hereto, except
Owner may assign this Escrow Agreement, in whole or in part, to any of its
Affiliates or Lender without Contractor’s or Escrow Agent’s consent.  When duly assigned in accordance with the
foregoing, this Escrow Agreement shall be binding upon and shall inure to the
benefit of the assignee; provided that
any assignment by a party pursuant to this Section 15 shall not relieve such
assigning party of any of its obligations under this Escrow Agreement.  Any assignment not in accordance with this
Section 15 shall be void and without force or effect, and any attempt to assign
this Escrow Agreement in violation of this provision shall grant the
non-assigning party the right, but not the obligation, to terminate this Escrow
Agreement at its option for default.

 

16.                                 Severability.  If one or more of the provisions hereof shall
for any reason be held to be invalid, illegal or unenforceable in any respect
under applicable law, such invalidity, illegality or unenforceability shall not
affect any other provisions hereof, and this Escrow Agreement shall be
construed as if such invalid, illegal or unenforceable provision had never been
contained herein, and the remaining provisions hereof shall be given full force
and effect.

 

17.                                 Termination.  This Escrow Agreement shall terminate upon
the disbursement, in accordance with Sections 4, 8 or 14 hereof, of the Escrow
Funds in full; provided, however, that in the
event all Fees required to be paid to Escrow Agent hereunder are not fully and
finally paid prior to termination, the provisions of Section 10 hereof shall
survive the termination hereof and, provided further,
that the last sentence of Section 8 hereof and the provisions of Section 9
hereof shall, in any event, survive the termination hereof.

 

18.                                 General.  The section headings contained in this Escrow
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Escrow Agreement.  This Escrow Agreement and any affidavit,
certificate, instrument, agreement or other document required to be provided
hereunder may be executed in two (2) or more counterparts, each of which shall
be deemed an original instrument, but all of which taken together shall
constitute one and the same instrument. 
Unless the context shall otherwise require, the singular shall include
the plural and vice-versa, and each pronoun in any gender shall include all
other genders.  The terms and provisions
of this Escrow Agreement constitute the entire agreement  among
the Parties and Escrow Agent in respect of the subject matter hereof, and
neither the Parties nor Escrow Agent has relied on any representations or
agreements of the other, except as specifically set forth in this Escrow
Agreement.  This Escrow Agreement or any
provision hereof may be amended, modified, waived or terminated only by written
instrument duly signed by the Parties and Escrow Agent.  This Escrow Agreement shall inure to the
benefit of, and be binding upon, the Parties and Escrow Agent and their respective
heirs, devisees, executors, administrators, personal representatives,
successors, trustees, receivers and permitted assigns.  This Escrow Agreement is for the sole and
exclusive benefit of the Parties and Escrow Agent, and nothing in this Escrow
Agreement, express or implied, is intended to confer or shall

 

DD-7

 

be construed as conferring upon any other person any rights, remedies
or any other type or types of benefits.

 

[Signature Page Follows]

 

DD-8

 

IN WITNESS WHEREOF, the parties
hereto have executed this Escrow Agreement to be effective as of the Effective
Date.

 

	
   

  	
  Owner:

  
	
   

  	
   

  
	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By: Sabine Pass LNG-LP, Inc., its General Partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
  Tax Identification #:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Contractor:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BECHTEL CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
  Tax Identification #:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Escrow Agent:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [NAME OF ESCROW AGENT]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
															

 

DD-9

 

Exhibit 1

 

Form of
Joint Notice

 

[Date]

 

[Name of Escrow Agent]

[Address]

Attn:  [                                           ]

 

Re:                               Escrow
Agreement, dated [                ],
2004, by and among Sabine Pass LNG, L.P. (“Owner”), Bechtel
Corporation (“Contractor”) and [Name of Escrow Agent] (“Escrow
Agent”) (the “Escrow Agreement”)

 

Dear [              ]:

 

Pursuant to Section 4(a) of the Escrow Agreement,
Owner and Contractor hereby certify that [$U.S.                    ]
of the Escrow Funds  (the “Released Escrow Funds”), plus any
accrued interest thereon, should be released from the Escrow Account and
disbursed to [Owner/Contractor/Owner and Contractor],
as set forth below.  Capitalized terms used, but not otherwise
defined, herein shall have the respective meanings ascribed to such terms in
the Escrow Agreement.

 

Owner and Contractor hereby direct Escrow Agent to
release and disburse such Released Escrow Funds by wire transfer in immediately
available funds, within [    ]
([    ]) Days of receipt of this notice, as
follows: [(i)]  [$U.S.                           ]
of the Released Escrowed Funds, plus accrued interest thereon, to [                    ]
to the following account [list account information
including name of recipient, name of recipient’s financial institution, account
number, and ABA routing number] [; and  (ii)
[$U.S.                           ]
of the Released Escrowed Funds, plus accrued interest thereon, to [                    ]
to the following account [list account information
including name of recipient, name of recipient’s financial institution, account
number, and ABA routing number].]

 

This Joint Notice may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same Joint Notice.  A facsimile or photocopy of any signature
shall have the same force and effect as an original.  This Joint Notice shall be effective as of
the date first written above once the counterparts of the Joint Notice have
been signed and delivered by all the parties set forth below.

 

	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
  Owner:

  
	
   

  	
   

  
	
   

  	
  SABINE PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine Pass LNG-LP, Inc.,
  its General Partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Contractor

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BECHTEL CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
												

 

cc:                                 [                                ]

 

DD-10

 

State of [                      ]

County of [                  ]

 

This instrument was
acknowledged before me on [Date] by [Name of Officer], [Title of Officer]
of [Name of entity acknowledging], a [jurisdiction]  [type of entity],
on behalf of said [type of entity].

 

	
  Commission expires:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Notary Public’s
  signature

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (Notary stamp or seal)

  	
   

  	
   

  
					

 

DD-11

 

Exhibit 2

 

Form of Owner’s Notice

 

[Date]

 

[Name
of Escrow Agent]

[Address]

Attn:  [                                         ]

 

Re:                               Escrow Agreement, dated [                ],
20[    ], by and
among Sabine Pass LNG, L.P. (“Owner”),
Bechtel Corporation (“Contractor”)
and [Name of Escrow Agent] (“Escrow Agent”) (the “Escrow Agreement”)

 

Dear
[              ]:

 

Pursuant to Section 4(b) of
the Escrow Agreement, Owner hereby certifies that [$U.S.                    ]
of the Escrow Funds (the “Released Escrow Funds”), plus
any accrued interest thereon, should be released from the Escrow Account and
disbursed to [Owner] [Name of Other Recipient],
as set forth below.  Capitalized terms used, but not otherwise defined,
herein shall have the respective meanings ascribed to such terms in the Escrow
Agreement.

 

Owner hereby directs Escrow
Agent to release and disburse such Released Escrowed Funds, plus accrued
interest thereon, by wire transfer in immediately available funds, within [    ] ([    ]) days
of receipt of this notice, as follows (provided that
Escrow Agent has not received, within sixty (60) Days of receipt of this
notice, written notice from Contractor of its objection to the terms of this
notice):

 

Sabine Pass LNG, L.P.

[Name of Financial Institution]

[City, State]

Account
No.: [                                                 ]

ABA Routing No.: [                                        ]

Amount:
U.S.$[                              ]

 

 

	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
  Owner:

  
	
   

  	
   

  
	
   

  	
  SABINE
  PASS LNG, L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:  Sabine Pass LNG-LP, Inc.,
  its General Partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

	
  cc:

  	
  Bechtel Corporation

  
	
   

  	
  3000
  Post Oak Boulevard

  
	
   

  	
  Houston,
  Texas 77056

  
	
   

  	
  Attn: [                                   ]

  

 

DD-12

 

State
of [                             ]

County
of [                         ]

 

This
instrument was acknowledged before me on [Date] by [Name of Officer], [Title of Officer]
of [Name of entity acknowledging], a [jurisdiction]  [type of entity],
on behalf of said [type of entity].

 

 

	
  Commission expires:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Notary Public’s
  signature

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (Notary stamp or seal)

  	
   

  	
   

  
					

 

DD-13

 

Exhibit 3

 

Fee
Schedule

 

 

[To come]

 

DD-14

 

ATTACHMENT EE

 

STAINLESS
STEEL ADJUSTMENT, TANK SUBCONTRACT MATERIALS

ADJUSTMENT, MARINE LOADING ARM ADJUSTMENT AND BOG

COMPRESSOR ADJUSTMENT

 

1.                          STAINLESS
STEEL ADJUSTMENT

 

1.1                   Stainless
Steel Adjustment

 

The Stainless Steel
Adjustment, which is used to account for the changes in commodity pricing of
304L stainless steel pipe, fittings and flanges as described in Section 7.1D of
the Agreement, shall be determined in accordance with this Section 1.  All calculations shall be rounded to four (4)
decimal places.

 

1.2                   Step
1, Determine Base Metal Price at NTP

 

Nibase
=                                nickel
base metal price

 

Crbase
=                               chromium base metal price

 

Febase  =                              iron
base metal price

 

The above Nibase, Crbase and Febase shall be as published by
North American Stainless at website http://www.northamericanstainless.com,
using the commercial information/flat alloy surcharge and the averages cited
for two (2) Months prior to NTP.   For
example, if the NTP is given in March 2005, the Monthly average for January
2005 shall be used.

 

1.3                   Step
2, Calculate Alloy Surcharge for Pipe “Pipesch” at NTP

 

Pipesch
= 0.096*(Nibase – 2.0) + 0.216*(Crbase – 0.35) +
0.8388*(Febase – 0.0625)

 

1.4                   Step
3, Determine Base Price for Pipe at NTP

 

The base price for
stainless pipe at NTP (“Pipebase”)
shall be the pricing index “Stainless Steel Pipe
& Tube – 4-1/2 in. to 16 in.” for the Month in which the NTP is
issued, as specified in the pricing index database maintained by Preston Pipe
& Tube Report, expressed in U.S. Dollars per lb.

 

1.5                   Step
4, Determine Piping Component of Adjustment

 

PipeNTP
= U.S.$10,860,880*[((Pipesch + Pipebase)/1.4635) – 1]

 

1.6                   Step
5, Calculate Alloy Surcharge for Fittings at NTP

 

Ftgsch
= 1.0836* Pipesch

1.7                   Step
6, Determine Fitting Component of Adjustment

 

FtgNTP
= U.S.$3,100,000*[((Ftgsch + Pipebase)/1.4938)
- 1]

 

1.8                   Step
7, Calculate Stainless Steel Adjustment

 

In accordance with
Section 7.1D of the Agreement, the Contract Price shall be adjusted by the
Stainless Steel Adjustment (“SSadj”),
which shall be determined as follows:

 

EE-1

 

SSadj
(in U.S.$) = PipeNTP +
FtgNTP

 

The
Stainless Steel Adjustment shall be paid as an adjustment to the applicable
Milestone(s) in Schedule C-1.

 

2.                          MARINE
LOADING ARM ADJUSTMENT AND BOG COMPRESSOR ADJUSTMENT

 

2.1                   Introduction

 

The Marine Loading Arm
Adjustment (“Armadj”) and BOG
Compressor Adjustment (“BOGadj”),
which are used to take into account currency fluctuations, shall be determined
in accordance with this Section 2.  All
calculations shall be rounded to four (4) decimal places. All currency exchange
rates shall be determined using FxConverter on
website http://www.oanda.com/convert/classic

 

In accordance with
Section 7.1F of the Agreement, the Contract Price shall be adjusted by the
Marine Loading Arm Adjustment, which shall be determined as follows:

 

Armadj  (in
U.S.$) = U.S.$6,289,705 * ((0.79177/EuroNTP)
- 1)

 

Where:

 

EuroNTP  = The currency exchange rate for Euros
compared to U.S.$ (Euro/U.S.$), defined as the Interbank rate, median price (ask) for the Day
of the Notice to Proceed.

 

In accordance with
Section 7.1G of the Agreement, the Contract Price shall be adjusted by the BOG
Compressor Adjustment, which shall be determined as follows:

 

BOGadj
(in U.S.$) = U.S.$8,314,332 * ((107.35/YenNTP) - 1)

 

Where:

 

YenNTP = The currency exchange rate for
Japanese Yen compared to U.S.$ (Yen/U.S.$) defined as the Interbank rate, median price (ask) for the Day
of the Notice to Proceed.

 

3.                          TANK
SUBCONTRACT MATERIALS ADJUSTMENT

 

3.1                   Exercise
Date

 

The Tank Subcontract
Materials Adjustment, which is used to account for changes in commodity pricing
of certain materials used in the Tanks, shall be determined in accordance with
this Section 3.

 

The date for determining
the Tank Subcontract Materials Adjustment shall be the “Exercise
Date,” which is the Day that Owner gives Contractor written
notice that Owner wants to set the date for determining the Tank Subcontract
Materials Adjustment.  The Exercise Date shall be no later
than thirty (30) Days before the material will be ordered, as advised in
writing by the Tank Subcontractor through Contractor.

 

The “Trended
Purchasing Magazine Business Information Center Price Index”
shall be the best fit linear regression straight line of the values of the each
of the applicable

 

EE-2

 

Purchasing Magazine Business Information Center Price Indices defined
in Sections 3.3 through 3.8 below from October 2004 for each Month through the
latest information available on the Exercise Date.

 

3.2                   Adjustment
for 9% Nickel Steel Materials (“9Niadj”)

 

9Niadj =
U.S.$4,644*((0.09 * N1) -1209.6)

 

Where “N1”  is
the price of nickel (in U.S.$/metric ton), as published in the Wall Street
Journal on the Day of the Exercise Date

 

3.3                   Adjustment
for Rebar and Anchors (“Rebaradj”)

 

Rebaradj =
U.S.$885,639*((R1/520) - 1)

 

Where “R1”is the Trended Purchasing Magazine Business Information Center Price
Index for Steel, reinforcing bar
(PURPRI50D208) at the Exercise Date.

 

3.4                   Adjustment
for Tank Stainless Steel (“TankSSadj”)

 

TankSSadj =
U.S.$729,942*[((S1+SSC1)/3480) - 1]

 

Where:

 

S1
 =                           the
Trended Purchasing Magazine Business Information Center Price Index for Stainless steel, hot rolled plate (PURPRI50D210),
for the [Month]
of the Exercise Date; and

 

SSC1
= the current Allegheny Ludlum Raw
Material Surcharge for 304/304L Stainless Steel, as published on website  http://www.alleghenyludlum.com,
for the Month  of  the
Exercise Date

 

3.5                   Adjustment
for Aluminum Materials (“Aladj”)

 

Aladj =
U.S.$1,577,315*((Al1/137) - 1)

 

Where “Al1”  is the
Trended Purchasing Magazine Business Information Center Price Index for Aluminum, grade 3003 common alloy sheet
(PURPRI50D303), for the [Month] of the Exercise Date.

 

3.6                   Adjustment
for Carbon Steel Materials (“CSadj”)

 

CSadj =
U.S.$16,648,373*((CS1/744) - 1)

 

Where “CS1”  is the Trended Purchasing
Magazine Business Information Center Price Index for Steel, hot rolled plate (PURPRI50D204) for the [Month] of the
Exercise Date.

 

3.7                   Adjustment
for Structural Steel Materials (“STadj”)

 

STadj =
U.S.$7,669,977*((ST1/574) - 1)

 

Where “ST1”  is the Trended Purchasing
Magazine Business Information Center Price Index for Steel, wide-flange beams (PURPRI50D206) for the [Month] of the Exercise
Date.

 

3.8                   Adjustment
for Piping and Valves (“PVadj”)

 

PVadj =
U.S.$7,642,495*[((S1+SSC1)  / 3480) -1]

 

EE-3

 

Where S1 and
SSC1 are as specified in Section 3.4 above.

 

3.9                   Tank
Subcontract Materials Adjustment

 

In accordance with
Section 7.1E, the Contract Price shall be adjusted by the Tank Subcontract
Materials Adjustment (“Tankadj”),
which shall be determined as follows:

 

Tankadj  (in
U.S.$) = Rebaradj + 9Niadj + TankSSadj
+ Aladj + CSadj + STadj + PVadj

 

The Parties agree that the commodity pricing methodology set forth in
this Section 3 for materials used in the Tanks is subject to change in the
course of Contractor’s selection of the Tank Subcontractor, and any change in
such pricing methodology shall be done by Change Order.

 

EE-4

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