Document:

exv10w1

 

Exhibit 10.1

Execution Copy

CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT

BY AND AMONG

ENTERPRISE PRODUCTS OPERATING L.P.,

DEP HOLDINGS, LLC,

DUNCAN ENERGY PARTNERS L.P.,

DEP OLPGP, LLC

AND

DEP OPERATING PARTNERSHIP, L.P.

DATED AS OF FEBRUARY 5, 2007

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS; RECORDATION 
	 	 	4	 
	1.1 Definitions
	 	 	4	 
	 
	 	 	 	 
	ARTICLE II THE OFFERING AND RELATED TRANSACTIONS  
	 	 	6	 
	2.1 Contribution by EPD OLP to MLP of the Subject Interests
	 	 	6	 
	2.2 Public Cash Contribution
	 	 	6	 
	2.3 MLP Receipt of Cash Contribution
	 	 	6	 
	2.4 MLP Cash Distribution to EPD OLP
	 	 	7	 
	2.5 Conveyance and Contribution by MLP (including 0.001% on behalf of OLP GP) to OLP of the
Subject Interests
	 	 	7	 
	 
	 	 	 	 
	ARTICLE III ASSUMPTION OF CERTAIN LIABILITIES 
	 	 	7	 
	3.1 Assumption of Subject Liabilities by MLP
	 	 	7	 
	3.2 Assumptions of Subject Liabilities by OLP
	 	 	7	 
	3.3 General Provisions Relating to Assumption of Liabilities
	 	 	8	 
	 
	 	 	 	 
	ARTICLE IV FURTHER ASSURANCES
	 	 	8	 
	4.1 Further Assurances
	 	 	8	 
	4.2 Other Assurances
	 	 	8	 
	 
	 	 	 	 
	ARTICLE V MISCELLANEOUS 
	 	 	8	 
	5.1 Order of Completion of Transactions
	 	 	8	 
	5.2 Headings; References; Interpretation
	 	 	9	 
	5.3 Successors and Assigns
	 	 	9	 
	5.4 No Third Party Rights
	 	 	9	 
	5.5 Counterparts
	 	 	9	 
	5.6 Governing Law
	 	 	9	 
	5.7 Assignment of Agreement
	 	 	9	 
	5.8 Amendment or Modification
	 	 	9	 
	5.9 Director and Officer Liability
	 	 	9	 
	5.10 Severability
	 	 	9	 
	5.11 Integration
	 	 	9	 

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CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT

     THIS CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT (this “Agreement”) dated as of
February 5, 2007, is made and entered into by and among Enterprise Products Operating L.P., a
Delaware limited partnership (“EPD OLP”), DEP Holdings, LLC, a Delaware limited liability
company (the “General Partner”), Duncan Energy Partners L.P., a Delaware limited
partnership (“MLP”), DEP Operating Partnership, L.P., a Delaware limited partnership
(“OLP”), and DEP OLPGP, LLC, a Delaware limited liability company (“OLP GP”). The
above-named entities are sometimes referred to in this Agreement each as a “Party” and
collectively as the “Parties.” Certain capitalized terms used are defined in Article I
hereof.

RECITALS

     WHEREAS, the General Partner and EPD OLP have formed MLP, pursuant to the Delaware Revised
Uniform Limited Partnership Act (the “Delaware LP Act”), for the purpose of engaging in any
business activity that is approved by the General Partner and that lawfully may be conducted by a
limited partnership organized pursuant to the Delaware LP Act.

     WHEREAS, in order to accomplish the objectives and purposes in the preceding recital, the
following actions have been taken prior to the date hereof:

          1. EPD OLP formed the General Partner, under the terms of the Delaware Limited Liability
Company Act (the “Delaware LLC Act”), to which EPD OLP contributed $1,000 in exchange for a
100% membership interest in the General Partner.

          2. The General Partner and EPD OLP formed MLP, under the terms of the Delaware LP Act, to
which the General Partner contributed $60 and EPD OLP contributed $2,940.00 in exchange for a 2%
general partner interest and 98% limited partner interest, respectively in MLP.

          3. MLP formed OLP GP, under the terms of the Delaware LLC Act, to which MLP contributed $1,000
in exchange for a 100% membership interest in OLP GP.

          4. OLP GP and MLP formed the OLP, under the terms of the Delaware LP Act, to which OLP GP
contributed $0.01 and MLP contributed $999.99 in exchange for a 0.001% general partner interest and
99.999% limited partner interest, respectively in OLP.

          5. EPD OLP and Enterprise Products OLPGP, Inc., a Delaware corporation “EPD OLPGP”),
formed Mont Belvieu Caverns, L.P., a Delaware limited partnership (“Mont Belvieu LP”),
under the terms of the Delaware LP Act, to which EPD OLPGP contributed $0.01 and EPD OLP
contributed $999.99 in exchange for a 0.001% general partner interest and 99.999% limited partner
interest, respectively, in Mont Belvieu LP.

          6. EPD OLP formed South Texas NGL Pipelines, LLC, a Delaware limited liability company
(“South Texas NGL”), under the terms of the Delaware LLC Act, to which EPD OLP contributed
$1,000 in exchange for a 100% membership interest in South Texas NGL.

 

 

          7. Mont Belvieu LP filed the necessary certificates and documents, under the terms of the
applicable laws of the State of Delaware and under the Delaware LP Act and the Delaware LLC Act,
pursuant to which Mont Belvieu LP was converted into a Delaware limited liability company named
Mont Belvieu Caverns, LLC (“Mont Belvieu LLC”) effective January 10, 2007, with EPD OLP and
EPD OLPGP owning 99.999% and 0.001% of the membership interests, respectively.

          8. MLP, OLP and certain other OLP subsidiaries have entered into a credit Agreement, dated as
of January 5, 2007, with Wachovia Bank, as Administrative Agent and Lender, and the other Lenders
named theretin (the “Credit Facility”), to, among other things, allow the MLP to borrow up
to $300 million under the Credit Facility (i) initially, in an amount not to exceed $210 million,
(A) for distribution to EPD OLP in connection with the contributions of assets under this Agreement
contemplated in connection with the initial public offering of common units by the MLP (the
“IPO”), and for payment of transaction and related offering expenses related to the
transaction contemplated by this Agreement, the IPO and the Credit Facility, and related
transactions, and (ii) thereafter, as a backstop for commercial paper and for working capital,
acquisitions, capital expenditures and other company purposes.

          9. EPD OLP, EPD OLPGP, Enterprise Products Texas Operating, LP, a Texas limited partnership
(“Texas Operating”) and Mont Belvieu LLC have entered into a Contribution, Conveyance and
Assumption Agreement, dated as of January 23, 2007 but effective on February 1, 2007, pursuant to
which (i) Texas Operating (a) contributed and conveyed its Mont Belvieu East and Mont Belvieu West
storage assets to Mont Belvieu LLC in exchange for membership interests in Mont Belvieu LLC, and
(b) immediately upon receipt thereof distributed such Mont Belvieu membership interests 1% to EPD
OLPGP and 99% to EPD OLP, and (ii) EPD OLP contributed and conveyed its Mont Belvieu North storage
assets and assigned certain storage contracts for a continuation of its 99.999% membership
interest, each as set forth on the schedules thereto. The limited liability company agreement of
Mont Belvieu LLC was amended to adjust the membership interests to reflect the relative capital
accounts of EPD OLP and EPD OLPGP after giving effect to the capital contributions.

          10. EPD OLP, Enterprise GC, L.P., a Delaware limited partnership (“Enterprise GC”),
Enterprise Holding III, LLC (“Holdings III”), Enterprise GTM Holdings LP (“GTM
Holdings”), Enterprise GTMGP, LLC (“GTMGP”) and South Texas NGL have entered into a
Contribution, Conveyance and Assumption Agreement, executed January 23, 2007 but effective on
January 1, 2007, pursuant to which (i) Enterprise GC has conveyed the South Texas NGL pipeline
assets, as set forth on the schedules thereto, to South Texas NGL, in exchange for membership
interests of South Texas NGL, (ii) Enterprise GC distributed all of such South Texas NGL membership
interests 99% to GTM Holdings and 1% to Holdings III, (iii) Holdings III distributed all of its
South Texas NGL membership interests to GTM Holdings, (iv) GTM Holdings distributed all of its
resulting South Texas NGL membership interests 99% to EPD OLP and 1% to GTMGP, (v) GTMGP
distributed all of its membership interests to GTM, (vi) GTM distributed all of such membership
interests to EPD OLP, and (vii) GTMGP distributed all of such membership interests to EPD OLP, with
the result that EPD OLP remained the sole member of South Texas NGL.

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     WHEREAS, concurrently with the consummation of the transactions contemplated hereby (the
“Closing”), each of the following matters shall occur:

          1. Each of Acadian Gas, LLC, a Delaware limited liability company (“Acadian Gas”),
South Texas NGL, Sabine Propylene Pipeline L.P, a Texas limited partnership "Sabine LP"),
Enterprise Lou-Tex Propylene Pipeline L.P., a Texas limited partnership (“Lou-Tex LP”), and
Mont Belvieu LLC will distribute its cash on hand, if any, to its respective members and partners.

          2. After giving effect to such distributions of cash on hand, EPD OLP, for itself and on
behalf of the General Partner for its respective interest in each of the Subject Interests to MLP
in exchange for a continuation of the General Partner’s 2% general partner interest in MLP, will
contribute the following equity interests in its subsidiaries to MLP: (a) a 66% membership
interest in Acadian Gas, (b) a 66% membership interest in South Texas NGL, (c) a 66% general
partner interest in Sabine LP, (d) a 66% general partner interest in Lou-Tex LP and (e) a 66%
membership interest in Mont Belvieu LLC (collectively, the “Subject Interests”).

          3. The public, through the Underwriters, will contribute $256,620,000 net of the
underwriters’ discounts and commissions and a $1,000,000 structuring fee (the “Offering
Proceeds”), to MLP in exchange for 13,000,000 Common Units representing a 62.8% limited partner
interest in MLP.

          4. MLP will use the net Offering Proceeds to (a) pay transaction expenses associated with the
transactions contemplated by this Agreement in the estimated net amount of approximately $2.9
million (exclusive of the underwriters’ discounts and commissions and structuring fees, but net of
a reimbursement for certain expenses received from the underwriters), (b) distribute an amount to
EPD OLP as a portion of the cash consideration equal to:

          (i) the Offering Proceeds, less

          (ii) $2.9 million (the estimated net transaction expenses), less

          (iii) the product of 66% multiplied by the difference between (x) $101.7 million and (y) the
actual construction and acquisition costs paid by EPD OLP or its Affiliates with respect to (A) the
South Texas NGL pipeline (excluding the original pipeline purchase costs of approximately $97.7
million) owned by South Texas NGL as of the date hereof and (B) the Mont Belvieu brine production
and above-ground storage projects included in or for the benefit of the assets owned by Mont
Belvieu Caverns as of the date hereof, prior to the contribution of interests in South Texas NGL
and Mont Belvieu Caverns to us pursuant to this Agreement at the Closing (as defined below)(such
amount, the “Distributable Proceeds”),

(c) provide approximately $18.9 million to make a capital contribution to South Texas NGL in
connection with the planned expansions to the South Texas NGL pipeline, and (d) provide
approximately $9.3 million to make a capital contribution to Mont Belvieu LLC in connection with
planned construction projects to expand brine production capacity and above-ground storage
reservoirs.

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          5. MLP will issue 7,301,571 Common Units to EPD OLP as partial consideration for the
contribution of the Subject Interests.

          6. MLP will contribute the Subject Interests and to OLP as a capital contribution.

          7. MLP will borrow approximately $200 million under the Credit Facility and distribute $198.9
million of such funds under the Credit Facility to EPD OLP as partial consideration for the
contribution of the Subject Interests.

          8. If the Underwriters exercise their option to purchase up to an additional 1,950,000 Common
Units, MLP shall use proceeds of that exercise, after deducting underwriters’ discounts and
commissions and structuring fees, to redeem an equal number of Common Units owned by EPD OLP.

          9. The agreements of limited partnership and the limited liability company agreements of the
aforementioned entities will be amended and restated to the extent necessary to reflect the
applicable matters set forth above and as contained in this Agreement.

     NOW, THEREFORE, in consideration of their mutual undertakings and agreements hereunder, the
Parties undertake and agree as follows:

ARTICLE I

DEFINITIONS; RECORDATION

     1.1 Definitions. Capitalized terms used herein and not defined elsewhere in this Agreement
shall have the meanings given such terms as is set forth below.

     “Acadian Gas” has the meaning assigned to such term in the recitals.

     “affiliate” means, with respect to a specified person, any other person controlling,
controlled by or under common control with that first person. As used in this definition, the term
“control” includes (i) with respect to any person having voting securities or the equivalent and
elected directors, managers or persons performing similar functions, the ownership of or power to
vote, directly or indirectly, voting securities or the equivalent representing 50% or more of the
power to vote in the election of directors, managers or persons performing similar functions, (ii)
ownership of 50% or more of the equity or equivalent interest in any person and (iii) the ability
to direct the business and affairs of any person by acting as a general partner, manager or
otherwise.

     “Agreement” has the meaning assigned to such term in the first paragraph of this
Agreement.

     “Common Units” has the meaning assigned to such term in the MLP Agreement.

     “Closing” has the meaning assigned to such term in the recitals.

     “Credit Facility” has the meaning assigned to such term in the recitals.

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     “Delaware LLC Act” has the meaning assigned to such term in the recitals.

     “Delaware LP Act” has the meaning assigned to such term in the recitals.

     “Distributable Proceeds” has the meaning assigned to such term in the recitals.

     “Effective Date” means February 5, 2007.

     “Enterprise GC” has the meaning assigned to such term in the recitals.

     “EPD OLP” has the meaning assigned to such term in the first paragraph of this
Agreement.

     “EPD OLPGP” has the meaning assigned to such term in the recitals.

     “General Partner” has the meaning assigned to such term in the first paragraph of this
Agreement.

     “IPO” has the meaning assigned to such term in the recitals.

     “Laws” means any and all laws, statutes, ordinances, rules or regulations promulgated
by a governmental authority, orders of a governmental authority, judicial decisions, decisions of
arbitrators or determinations of any governmental authority or court.

     “Lou-Tex LP” means Enterprise Lou-Tex Propylene Pipeline L.P., a Texas limited
partnership.

     “MLP” has the meaning assigned to such term in the first paragraph of this Agreement.

     “MLP Agreement” means the Amended and Restated Agreement of Limited Partnership, dated
as of February 5, 2007, of the MLP.

     “Mont Belvieu LLC” has the meaning assigned to such term in the recitals.

     “Mont Belvieu LP” has the meaning assigned to such term in the recitals.

     “Offering Proceeds” has the meaning assigned to such term in the recitals.

     “OLP” has the meaning assigned to such term in the first paragraph of this Agreement.

     “OLP GP” has the meaning assigned to such term in the first paragraph of this
Agreement.

     “Party” and “Parties” have the meanings assigned to such terms in the first paragraph
of this Agreement.

     “Prospectus” means the final prospectus dated January 30, 2007 related to the
Registration Statement on Form S-1 (File No. 333-138371) filed by the MLP with the Securities and
Exchange Commission, in connection with the MLP’s initial public offering.

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     "Sabine LP” has the meaning assigned to such term in the recitals.

     "South Texas NGL” has the meaning assigned to such term in the recitals.

     "Subject Interests” has the meaning assigned to such term in the recitals.

     "Subject Liabilities” means all obligations and liabilities relating to the Subject
Interests.

     “Texas Operating” has the meaning assigned to such term in the recitals.

ARTICLE II

THE OFFERING AND RELATED TRANSACTIONS

     2.1 Contribution by EPD OLP to MLP of the Subject Interests. EPD OLP, for itself and on
behalf of the General Partner for its respective interest in each of the Subject Interests to MLP
in exchange for a continuation of the General Partner’s 2% general partner interest in MLP, hereby
grants, contributes, transfers, assigns and conveys to MLP, its successors and assigns, for its and
their own use forever, the Subject Interests, and MLP hereby accepts the distribution of the
Subject Interests from EPD OLP for its own account as an additional capital contribution in
exchange for 7,301,571 Common Units representing a 35.2% limited partner interest in MLP (and
approximately 36.0% of the initial outstanding Common Units).

     TO HAVE AND TO HOLD the Subject Interests unto MLP, its successors and assigns, together with
all and singular the rights and appurtenances thereto in anywise belonging, subject, however, to
the terms and conditions stated in this Agreement, forever.

     2.2 Public Cash Contribution. The Parties acknowledge the cash contribution of the Offering
Proceeds from the public through the underwriters to MLP in connection with the Offering in
exchange for 13,000,000 Common Units representing a 62.8% limited partner interest in MLP (and
approximately 64.0% of the initial outstanding Common Units), which cash contribution is being made
and which Common Units are being issued immediately after the effective time of the contribution
and transfer of the Subject Interests to the MLP.

     2.3 MLP Receipt of Cash Contribution. MLP acknowledges receipt of the Offering Proceeds
(which are net of the underwriting discounts and commissions and structuring fees withheld by the
underwriters from the Offering Proceeds as payment thereof) in cash as a capital contribution to
MLP, and the Parties acknowledge that MLP has used all of such capital contributions to (a) pay
transaction expenses associated with the transactions contemplated by this Agreement in the
estimated amount of
approximately $2.9 million (exclusive of the underwriters’ discounts and commissions and
structuring fees and net of a reimbursement for certain expenses received from the underwriters),
(b) distribute the Distributable Proceeds to EPD OLP as a portion of the cash consideration, (c)
provide approximately $18.9 million to make a capital contribution to South Texas NGL in connection
with the planned expansions to the South Texas NGL pipeline, and (d) provide approximately $9.3
million to make a capital contribution to Mont Belvieu LLC in connection with planned construction
projects to expand brine production capacity and above-ground storage reservoirs.

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     2.4 MLP Cash Distribution to EPD OLP. The Parties acknowledge the distribution by MLP of (1)
$198,900,000 from borrowings under the Credit Facility and (2) the Distributable Proceeds, and the
receipt by EPD OLP of such cash amounts from MLP. A portion of these distributions have been made
to satisfy the reimbursement for capital expenditures of EPD OLP.

     2.5 Conveyance and Contribution by MLP (including 0.001% on behalf of OLP GP) to OLP of the
Subject Interests. MLP hereby grants, contributes, transfers, assigns and conveys to OLP
(including 0.001% on behalf of OLP GP), its successors and assigns, for its and their own use
forever, all of its rights, title and interest in and to the Subject Interests and OLP hereby
accepts the Subject Interests as an additional capital contribution from each of MLP and OLP GP.

     TO HAVE AND TO HOLD the Subject Interests unto OLP, its successors and assigns, together with
all and singular the rights and appurtenances thereto in anywise belonging, subject, however, to
the terms and conditions stated in this Agreement, forever.

ARTICLE III

ASSUMPTION OF CERTAIN LIABILITIES

     3.1 Assumption of Subject Liabilities by MLP. In connection with the contribution by EPD OLP
of the Subject Interests to MLP, as set forth in Section 2.1 above, MLP hereby assumes and
agrees to duly and timely pay, perform and discharge all of the Subject Liabilities, to the full
extent that EPD OLP has been heretofore or would have been in the future obligated to pay, perform
and discharge the Subject Liabilities were it not for such distribution and the execution and
delivery of this Agreement; provided, however, that said assumption and agreement to duly and
timely pay, perform and discharge the Subject Liabilities shall not (i) increase the obligation of
MLP with respect to the Subject Liabilities beyond that of EPD OLP, (ii) waive any valid defense
that was available to EPD OLP with respect to the Subject Liabilities or (iii) enlarge any rights
or remedies of any third party under any of the Subject Liabilities.

     3.2 Assumptions of Subject Liabilities by OLP. In connection with the contribution by MLP of
the Subject Interests to OLP, as set forth in Section 2.5 above, OLP hereby assumes and
agrees to duly and timely pay, perform and
discharge all of the Subject Liabilities, to the full extent that MLP has been heretofore or
would have been in the future obligated to pay, perform and discharge the Subject Liabilities were
it not for such distribution and the execution and delivery of this Agreement; provided, however,
that said assumption and agreement to duly and timely pay, perform and discharge the Subject
Liabilities shall not (i) increase the obligation of OLP with respect to the Subject Liabilities
beyond that of MLP, (ii) waive any valid defense that was available to MLP with respect to the
Subject Liabilities or (iii) enlarge any rights or remedies of any third party under any of the
Subject Liabilities.

     3.3 General Provisions Relating to Assumption of Liabilities. Notwithstanding anything to the
contrary contained in this Agreement including, without limitation, the terms and provisions of
this Article III, none of the Parties shall be deemed to have assumed, and the Subject Interests
have not and are not being distributed or contributed, as the case may be, subject to, any liens or
security interests securing consensual indebtedness covering such Subject

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Interests, and all such
liens and security interests shall be deemed to be excluded from the assumptions of liabilities
made under this Article III.

ARTICLE IV

FURTHER ASSURANCES

     4.1 Further Assurances. From time to time after the date hereof, and without any further
consideration, the Parties agree to execute, acknowledge and deliver all such additional deeds,
assignments, bills of sale, conveyances, instruments, notices, releases, acquittances and other
documents, and will do all such other acts and things, all in accordance with applicable Law, as
may be necessary or appropriate (a) more fully to assure that the applicable Parties own all of the
properties, rights, titles, interests, estates, remedies, powers and privileges granted by this
Agreement, or which are intended to be so granted, (b) more fully and effectively to vest in the
applicable Parties and their respective successors and assigns beneficial and record title to the
interests contributed and assigned by this Agreement or intended so to be and (c) to more fully and
effectively carry out the purposes and intent of this Agreement.

     4.2 Other Assurances. From time to time after the date hereof, and without any further
consideration, each of the Parties shall execute, acknowledge and deliver all such additional
instruments, notices and other documents, and will do all such other acts and things, all in
accordance with applicable Law, as may be necessary or appropriate to more fully and effectively
carry out the purposes and intent of this Agreement. It is the express intent of the Parties that
MLP or its subsidiaries own the Subject Interests that are identified in this Agreement and in the
Prospectus.

ARTICLE V

MISCELLANEOUS

     5.1 Order of Completion of Transactions. The transactions provided for in Article II and
Article III of this Agreement shall be completed on the Effective Date in the following order:

          First, the transactions provided for in Article II shall be completed in the order set forth
therein; and

          Second, the transactions provided for in Article III shall be completed in the order set forth
therein.

     5.2 Headings; References; Interpretation. All Article and Section headings in this Agreement
are for convenience only and shall not be deemed to control or affect the meaning or construction
of any of the provisions hereof. The words “hereof,” “herein” and “hereunder” and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. All references herein to Articles and Sections shall,
unless the context requires a different construction, be deemed to be references to the Articles
and Sections of this Agreement, respectively. All personal pronouns used in this Agreement,
whether used in the masculine, feminine or neuter gender, shall include all other genders, and the
singular shall include the plural and vice versa. The use herein of the word “including” following
any general statement, term or matter shall not be construed to limit such

-8-

 

statement, term or
matter to the specific items or matters set forth immediately following such word or to similar
items or matters, whether or not non-limiting language (such as “without limitation,” “but not
limited to,” or words of similar import) is used with reference thereto, but rather shall be deemed
to refer to all other items or matters that could reasonably fall within the broadest possible
scope of such general statement, term or matter.

     5.3 Successors and Assigns. The Agreement shall be binding upon and inure to the benefit of
the Parties signatory hereto and their respective successors and assigns.

     5.4 No Third Party Rights. Except as provided herein, nothing in this Agreement is intended
to or shall confer upon any person other than the Parties, and their respective successors and
permitted assigns, any rights, benefits, or remedies of any nature whatsoever under or by reason of
this Agreement and no person is or is intended to be a third party beneficiary of any of the
provisions of this Agreement.

     5.5 Counterparts. This Agreement may be executed in any number of counterparts, all of which
together shall constitute one agreement binding on the parties hereto.

     5.6 Governing Law. This Agreement shall be governed by, and construed in accordance with, the
Laws of the State of Texas applicable to contracts made and to be performed wholly within such
state without giving effect to conflict of law principles thereof, except to the extent that it is
mandatory that the Law of some other jurisdiction, wherein the interests are located, shall apply.

     5.7 Assignment of Agreement. Neither this Agreement nor any of the rights, interests, or
obligations hereunder may be assigned by any Party without the prior written consent of each of the
Parties.

     5.8 Amendment or Modification. This Agreement may be amended or modified from time to time
only by the written agreement of all the Parties hereto and affected thereby.

     5.9 Director and Officer Liability. Except to the extent that they are a party hereto, the
directors, managers, officers, partners and securityholders of the Parties and their respective
affiliates shall not have any personal liability or obligation arising under this Agreement
(including any claims that another party may assert).

     5.10 Severability. If any term or other provision of this Agreement is invalid, illegal, or
incapable of being enforced under applicable Law or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated herein are not affected in any manner
adverse to any Party. Upon such determination that any term or other provision of this Agreement
is invalid, illegal, or incapable of being enforced, the Parties shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the Parties as closely as possible in
a mutually acceptable manner in order that the transactions contemplated herein are consummated as
originally contemplated to the fullest extent possible.

     5.11 Integration. This Agreement and the instruments referenced herein supersede any and all
previous understandings or agreements among the Parties, whether oral or written,

-9-

 

with respect to
their subject matter. This Agreement and such instruments contain the entire understanding of the
Parties with respect to the subject matter hereof and thereof. No understanding, representation,
promise or agreement, whether oral or written, is intended to be or shall be included in or form
part of this Agreement or any such instrument unless it is contained in a written amendment
hereto or thereto and executed by the Parties hereto or thereto after the date of this Agreement or
such instrument.

[The Remainder of this Page is Intentionally Blank]

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     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the date
first above written.

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	ENTERPRISE PRODUCTS OPERATING L.P.  
	 

	 	By:
	 	ENTERPRISE PRODUCTS OLPGP, INC.,	 	 
	 

	 	 	 	its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard H. Bachmann 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Richard H. Bachmann	 	 
	 

	 	 	 	Executive Vice President, Chief Legal Officer and Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	DEP HOLDINGS, LLC
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard H. Bachmann 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Richard H. Bachmann	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	DUNCAN ENERGY PARTNERS L.P.
	 

	 	By:
	 	DEP HOLDINGS, LLC, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard H. Bachmann 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Richard H. Bachmann	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	DEP OPERATING PARTNERSHIP, L.P.
	 

	 	By:
	 	DEP OLPGP, LLC, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard H. Bachmann 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Richard H. Bachmann	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	DEP OLPGP, LLC
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard H. Bachmann 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Richard H. Bachmann	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 

Signature
Page to Contribution, Conveyance and Assumption Agreementexv10w2

 

 

			
	***	 	Indicates material has been omitted pursuant to a Confidential Treatment Request filed with
the Securities and Exchange Commission. A complete copy of this agreement has been filed
separately with the Securities and Exchange Commission.

Exhibit 10.2

FORM OF STORAGE LEASE

(Enterprise Products NGL Marketing)

     This is a Storage Lease (the “Lease”) between MONT BELVIEU CAVERNS, LLC with an address
at P.O. Box 4324, Houston, Texas 77210-4324 (“Lessor”) and ENTERPRISE PRODUCTS OPERATING L.P.,
(“Lessee”), with an address at P.O. Box 4324, Houston, Texas 77210-4324.

1. Term; Quantity; Product.

For an
initial term commencing February 1, 2007 and ending December 31, 2016 (the “Initial Term”),
Lessor leases to Lessee storage space of up to *** barrels of purity ethane, propane, commercial
ethane, isom grade butane (“Isom Grade”), High Purity Isobutane (“HP Isobutane”), isobutane,
natural gasoline, and petrochemical grade natural gasoline (collectively referred to as “Product”
in this Lease) at Lessor’s underground storage wells, located near Interstate 10 and State Highway
146 at Mont Belvieu, Texas, subject to the terms, provisions, and conditions contained herein. For
purposes of this Lease, a “barrel” of Product is equal to 42 U.S. gallons of equivalent liquid
volume at 60° Fahrenheit.

Each twelve (12) month period between January 1 and the following December 31 shall be referred to
herein as a “Lease Year”. This Lease shall continue from year to year following the expiration of
the Initial Term, unless either party terminates this Lease by giving written notice to the other
party at least ninety (90) days prior to the beginning of any ensuing Lease Year.

2. Lessor’s Facilities.

Lessor operates storage wells in which various types of products are stored other than the types of
Product covered by this Lease. Lessor’s storage wells are connected to centrally located pipeline
header facilities operated by Lessor on its property in the vicinity of said storage wells. All
Product delivered by Lessee into or by Lessor out of storage must be delivered by pipeline to such
header facilities, and all such deliveries shall be deemed a delivery into or out of storage for
the purposes of computing all applicable charges under this Lease. As between Lessor and Lessee,
control of Lessor’s facilities will rest exclusively with Lessor.

3. Product Specifications.

Each Product delivered by Lessee into storage or by Lessor from storage must meet the respective
specifications set out in Exhibit “A” attached hereto and made a part hereof. Lessor reserves the
right to modify, add to, or revise such specifications at any time and from time-to time upon
giving not less than thirty (30) days prior written notice.

Storage Lease (Enterprise Products NGL Marketing)

 

 

4. Isom Grade Butane; Analysis and Certification.

Prior to each delivery of Isom Grade by or on behalf of Lessee into storage hereunder, Lessee
agrees to certify to Lessor the quality of the butane to be delivered and to furnish to Lessor a
laboratory analysis of the butane to be delivered to Lessor for storage at least forty-eight (48)
hours prior to delivery. The laboratory analysis shall be in form satisfactory to Lessor, shall
employ the test methods specified on Exhibit “A”, and shall show the levels, if any, of the
components listed on Exhibit “A”. If (i) a laboratory analysis required under this paragraph is
not timely received by Lessor; (ii) the laboratory analysis received is not in a form acceptable to
Lessor; or (iii) the laboratory analysis shows the butane to be delivered does not meet the
specifications for Isom Grade, Lessor has the right to refuse receipt of the butane. Also, if, at
any time during Lessee’s delivery of Isom Grade, the butane being tendered ceases to conform to the
specifications for Isom Grade, Lessor will stop receiving the butane tendered for storage, until
such time as the tendered product can be shown to again meet the Isom Grade specification.

5. Product Deliveries and Receipts.

It shall be Lessee’s responsibility to make all arrangements necessary to deliver Product for
storage and to receive Product from storage at Lessor’s header facilities, and to pay any charges
imposed by any party for the collection, transfer, and injection of Lessee’s Product to such header
facilities for delivery into storage or from such header facilities for delivery out of storage
under this Lease. The flow rates into and out of storage are subject to Lessor’s scheduling and
operational restrictions.

6. Delivery Restrictions; Allocation.

If Lessor’s scheduling or operational restrictions will not permit all of the parties (including
Lessor) storing any types of products in any of Lessor’s storage wells to deliver or receive the
volumes of Product requested, then Lessor may allocate among such parties Lessor’s available flow
rates in a fair and equitable manner as determined by Lessor.

7. Commingling; Sampling.

Lessor shall have the privilege of commingling Lessee’s Product with Product of other parties and
is not obligated to redeliver to Lessee the identical Product received from Lessee. Lessor shall
have the right to sample all Product to be delivered for storage and may refuse to accept delivery
of any Product if the Product does not meet the required specifications or, if in Lessor’s opinion,
satisfactory control of Product specifications will not be maintained during delivery. At Lessor’s
request, Lessee shall provide Lessor access to the Product to be delivered for the purpose of
sampling and provide Lessor representative samples of such Product.

At Lessor’s sole discretion, Lessor shall have the option to blend Lessee’s Product that fails to
meet the Product specifications with Product within Lessor’s facilities to get Lessee’s Product
back on specification, or to deliver Lessee’s off specification Product to Lessor’s off
specification Product storage well (the “Slop Well”) where the Product will reside until such

Storage Lease (Enterprise Products NGL Marketing)

2

 

time
as Lessor arranges for the Product in the Slop Well to be sent to one of the Mont Belvieu
fractionators for fractionation.

Lessor will continue to blend the off specification Product, or to make deliveries to the Slop
Well, only until the Product once again meets the specifications in the attached Exhibit “A”, or
until such time as Lessor is notified by Lessee that other delivery arrangements have been made for
the Product and the delivery of off specification Product to Lessor’s facilities stops.

The fee for receiving off specification Product into Lessor’s facilities will be *** per barrel on
each barrel received. Lessee will share in any losses of Product from the Slop Well in proportion
to the amount of the off-specification Product that was delivered into the Slop Well since the last
time the Slop Well was emptied for Lessee’s account hereunder..

If Lessee elects to have the Products redelivered to Lessor’s facilities following fractionation,
all such receipts shall be done under the terms of this Lease.

If it is necessary for Lessor to pay any charges, including but not limited to, fractionation fees,
when the off specification Product is delivered from the Slop Well and fractionated, Lessee will
immediately upon receipt of an invoice reimburse Lessor for any such charges.

8. Product Measurement.

     (a) Ethane

Measurement of commercial ethane and purity ethane into and out of storage shall be made in
accordance with the procedures and methods set out in Exhibit “B”. All product gains and losses
incurred while commercial ethane and purity ethane are under Lessor’s control shall be for the
account of Lessee in proportion to the amount of commercial ethane or purity ethane delivered into
storage by Lessee since the last time any such losses were calculated except as noted in Section
17. For the purpose of this subparagraph 8 (a), ethylene and up to 1.5% methane shall be
considered ethane. Any methane in excess of 1.5% will not be balanced. Lessor shall return to
Lessee a volume of commercial ethane containing a quantity of ethane equal to the quantity of
ethane contained in the commercial ethane delivered by Lessee for storage hereunder. If Lessor
returns commercial ethane to Lessee containing more or less propane than was contained in the
commercial ethane delivered by Lessee for storage hereunder, Lessor and Lessee shall quarterly
balance any overages or underages of propane by the party having the overage delivering to the
other party a volume of propane equal to the overage, which propane shall meet the specifications
set out in Exhibit “A”. Lessor shall submit to Lessee monthly stock reports supported with
appropriate receiving and shipping information showing movements of commercial ethane and purity
ethane into and out of storage and the amount of commercial ethane and purity ethane remaining in
storage. All propane required to be delivered to Lessor shall be delivered at the expense of
Lessee to Lessor’s pipeline header facilities at Mont Belvieu, Texas, via one of the pipelines
connected to such facilities. All propane required to be delivered to Lessee shall be delivered at
the expense of Lessor to its pipeline header facilities at Mont Belvieu, Texas. Propane may be
delivered at any other delivery point mutually acceptable to the

Storage Lease (Enterprise Products NGL Marketing)

3

 

parties. For the purpose of this
subparagraph 8 (a) propylene and butane shall be considered propane.

     (b) Other Products.

Measurement of propane, Isom Grade, natural gasoline, petrochemical grade natural gasoline, HP
Isobutane, and isobutane into and out of storage shall also be made in accordance with the
procedures and methods set out in Exhibit “B”. All Product gains and losses incurred while the
product is under Lessor’s control shall be for the account of Lessee in proportion to the amount of
propane, Isom Grade, natural gasoline, petrochemical grade natural gasoline, HP Isobutane, and
isobutane delivered into storage by Lessee since the last time any such losses were calculated
except as noted in Section 17. Lessor shall submit to Lessee monthly stock reports supported with
appropriate receiving and shipping information showing movements of propane, Isom Grade, natural
gasoline, petrochemical grade natural gasoline, HP Isobutane, and isobutane into and out of storage
and the amount of propane, Isom Grade, natural gasoline, petrochemical grade natural gasoline, HP
Isobutane, and isobutane remaining in storage.

     (c) Carbon Dioxide.

Lessee will not be credited for any volume of carbon dioxide held in storage for Lessee by Lessor.

     (d) Percentages.

Any references to percentages herein shall mean liquid volume percent.

9. Title; Risk of Loss.

Title to Lessee’s Product shall remain at all times in Lessee. Notwithstanding the return
guarantee set out in subparagraphs 8 (a) and 8 (b) above, Lessor shall be responsible for the loss
of or damage to such Product only when and to the extent such loss or damage is caused by the
negligence of Lessor, its employees and agents.

10. Storage Fees.

Lessee agrees to pay Lessor for the storage, handling, and services of Lessor a total minimum
rental as set forth in Schedule 1. All minimum rentals are payable in full regardless of whether
or not Lessee actually uses the amount of storage made available hereunder. All of Lessee’s
Product must be removed from storage no later than the last day of the term of this Lease, subject
to the payment of accrued rental and other charges and the other terms, provisions, and conditions
of this Lease. The rate for storage of any Product remaining in storage past the last day of the
term of this Lease shall be *** per barrel per month or any portion thereof, payable in advance on
the first day of each month in the same manner and at the same place as set forth in Section 15.

Storage Lease (Enterprise Products NGL Marketing)

4

 

11. Throughput Fees

Lessee agrees to pay Lessor a handling charge of *** per barrel for each barrel of Product that is
physically delivered or allocation transferred into storage, and *** per barrel for each barrel of
Product that is physically delivered out of storage under this Lease. Each delivery or receipt of
Product that is transferred in-well by means of a letter transfer (an “Inventory Delivery”) will be
charged a fee of *** per transaction. Lessee agrees to promptly pay to Lessor, upon receipt of an
invoice, at Lessor’s address set forth on the face of such invoice for the charges hereunder. Both
the throughput fee and the Inventory Delivery Fee will be escalated annually as set forth in
Schedule 1.

12. Facility Fee.

In addition to all other fees hereunder, Lessee agrees to pay Lessor an infrastructure handling fee
(the “Facility Fee”) of *** per barrel on all barrels of Product that are physically received or
allocation transferred into storage, and on all barrels that are physically delivered out of
storage. The Facility Fee will be escalated annually in accordance with Schedule 1 attached
hereto.

13. Overstorage Fees

An overstorage charge of *** per barrel shall be charged for the total number of barrels stored by
Lessee at the end of any month that exceeds the amount of storage space leased for each specific
Product hereunder. Any excess storage acquired in this manner shall be understood to be temporary
only, and shall not constitute a waiver of Lessor’s right to restrict storage to the amount leased
hereunder at any time thereafter, and Lessee shall promptly remove any such excess Product upon
Lessor’s written request.

14. Taxes.

Lessee shall pay all taxes, if any, levied or assessed on the Product stored hereunder. In the
event it becomes necessary for Lessor to pay any such tax, Lessee shall immediately reimburse
Lessor for such amount upon receipt of notice of payment.

15. Payment Terms.

The total minimum annual rental for storage is payable in equal monthly installments during the
term hereof, each of which installments is due and payable in advance by Lessee at Lessor’s address
set forth on the face of each invoice on or before the first day of each month. Lessor will also
invoice Lessee each month for all applicable throughput fees, overstorage fees and other fees or
charges during the term of this Lease.

Storage Lease (Enterprise Products NGL Marketing)

5

 

16. Warehouseman’s Lien.

Lessor shall have a lien on all Product of Lessee stored hereunder to cover any accrued and unpaid
amounts payable hereunder and may withhold delivery of any such Product until such accrued and
unpaid amounts are paid. If any such amounts remain unpaid for more than thirty (30) days after
they accrue, Lessor may sell said Product at a public auction at the offices of Lessor in Houston,
Harris County, Texas, on any day not a legal holiday and not less than forty-eight (48) hours after
publication of notice in a daily newspaper of general circulation published in Baytown, Texas, said
notice giving the time and place of the sale and the quantity and Product to be sold. Lessor may
be a bidder and a purchaser at such sale. From the proceeds of such sale, Lessor may pay itself
all charges lawfully accruing and all expenses of such sale, and the net balance may be held for
whomsoever may be lawfully entitled thereto.

17. Product Losses.

Any loss of Product from Lessor’s storage wells for which Lessor is not responsible shall be
apportioned among all of the parties storing such Product in such storage wells on the date of loss
in proportion to the amount of Product each such party has in storage on such date. Product is not
insured by Lessor against loss or damage however caused, and any insurance thereon must be provided
and paid for by Lessee. Lessor’s liability, if any, for loss or damages to the stored Product
shall be limited to the monthly average NON TEPPCO price on the Texas Gulf Coast for such Product
on the date of such loss or damage as reported or published by Oil Price Information Service
(“OPIS”) (the “Published Price”), or at Lessor’s option, replacement of such lost or damaged
Product in kind within forty-five (45) days of such loss. If the Published Price is not reported
or published by OPIS for the date in question, the parties will endeavor to promptly agree upon
such a price.

18. Force Majeure.

Lessor shall not be responsible to Lessee for any loss of Lessee’s Product, for any loss to Lessee
resulting from delays in returning Lessee’s Product when requested, or for failure of Lessor to
perform its obligations hereunder, due, directly or indirectly, to acts of God or other causes
beyond the reasonable control of Lessor including, without limitation, storm; earthquake;
accidents; acts of the public enemy; emergency or unplanned scheduling and operational
restrictions; rebellion; insurrections; sabotage; invasion; epidemic; strikes; lockouts or other
industrial disturbances; war; riot; hurricane; fire; flood; explosion; compliance with acts, rules,
regulations, or orders of federal, state, or local government, any agency thereof or other
authority having or purporting to have jurisdiction; mechanical failures or similar causes not due
to Lessor’s fault or negligence. The term of this Lease shall not be extended by the duration of
any force majeure, nor shall Lessee be excused from making any payment due under this Lease. When
claiming force majeure, Lessor shall notify Lessee immediately by telephone, and confirm same in
writing, giving reasonable detail regarding the type of force majeure and its estimated duration.
The settlement of differences with workers shall be entirely within the Lessor’s discretion.

Storage Lease (Enterprise Products NGL Marketing)

6

 

19. Indemnity.

REGARDLESS OF THE LEGAL THEORY OR THEORIES ALLEGED INCLUDING, WITHOUT LIMITATION, THE NEGLIGENCE
(WHETHER SOLE, JOINT, OR CONCURRENT) OF ANY THIRD PARTY, LESSEE HEREBY AGREES TO INDEMNIFY, DEFEND,
AND SAVE HARMLESS LESSOR, ITS PARENT COMPANY, PARTNERS (GENERAL OR LIMITED), MEMBERS, SUBSIDIARIES,
AFFILIATES, SUCCESSORS, AND ASSIGNS, INCLUDING ANY OFFICER, DIRECTOR, EMPLOYEE, OR AGENT OF ANY
SUCH ENTITY (HEREINAFTER COLLECTIVELY CALLED “INDEMNITEE”) FROM AND AGAINST ANY CLAIM, DEMAND,
CAUSE OF ACTION, DAMAGE, FINE, PENALTY, LOSS, JUDGMENT, OR EXPENSE OF ANY KIND OF ANY PARTY
(HEREINAFTER COLLECTIVELY CALLED “LIABILITY”), INCLUDING ANY EXPENSES OF LITIGATION, COURT COSTS,
AND REASONABLE ATTORNEY’S FEES, RESULTING FROM, ARISING OUT OF, OR CAUSED BY THE DELIVERY OF ANY
PRODUCT BY LESSEE OR LESSEE’S AGENT, CONTRACTOR, OR CARRIER WHICH IS CONTAMINATED OR OTHERWISE
FAILS TO MEET THE SPECIFICATIONS SET FORTH HEREIN, EXCEPT TO THE EXTENT SUCH LIABILITY IS DIRECTLY
CAUSED BY THE NEGLIGENCE OR WILLFUL MISCONDUCT OF AN INDEMNITEE.

20. Claims; Limitations.

Notice of claims by Lessee for any liability, loss, damage, or expense arising out of this Lease
must be made to Lessor in writing within ninety-one (91) days after the same shall have accrued.
Such claims, fully amplified, must be filed with Lessor within said ninety-one (91) days and unless
so made and filed, Lessor shall be wholly released and discharged therefrom and shall not be liable
therefor in any court of justice. No suit at law or in equity shall be maintained upon any claim
unless instituted within two (2) years and one (1) day after the cause of action accrued.

In no event shall Lessor be liable to Lessee for any prospective or speculative profits, or
special, indirect, incidental, exemplary, punitive, or consequential damages, whether based upon
contract, tort, strict liability, or negligence, or in any other manner arising out of this Lease,
and Lessee hereby releases Lessor from any claim therefor.

21. Notice.

All notices, demands, requests, and other communications necessary to be given hereunder shall be
in writing and deemed given if personally delivered, forwarded by facsimile (with proof of
transmission and answer-back capability), or mailed by either certified mail, return receipt
requested, or sent by recognized overnight carrier to the respective party at its address below:

Storage Lease (Enterprise Products NGL Marketing)

7

 

If to Lessor:
Mont Belvieu Caverns, LLC 
P.O. Box 4324 
Houston, Texas 77210-4324 
Attn: Director
- Hydrocarbon Storage 
Telephone: (713) 381-6554 
Fax: (713) 381-6960

If to Lessee: 
Enterprise Products Operating L.P. 
P.O. Box 4324 
Houston, Texas 77210-4324 
Attn:
V.P. Marketing 
Telephone: (713) 381-6549 
Fax: (713) 381-381-6965

22. Assignment.

Neither party shall assign any portion of its rights or obligations under this Lease without the
prior written consent of the other, which consent shall not be unreasonably withheld; provided,
however, either party may assign this Lease to its parent corporation, a wholly-owned subsidiary,
to an affiliate, to a successor who acquires all, or substantially all, of the assets of the
assigning party, or, if a party hereto is a limited partnership, to one or its limited partners or
the members of its general partner, without the consent of the other party, provided that it
remains primarily obligated hereunder. This Lease shall be binding upon and inure to the benefit
of the parties hereto, their successors and assigns.

23. Rules and Regulations.

This Lease and the provisions hereof shall be subject to all applicable state and federal laws and
to all applicable rules, regulations, orders, and directives of any governmental authority, agency,
commission, or regulatory body in connection with any and all matters or things under or incident
to this Lease.

24. Entire Agreement.

This Lease embodies the entire agreement between Lessor and Lessee and there are no promises,
assurances, terms, conditions, or obligations, whether by precedent or otherwise, other than those
contained herein. No variation, modification, or reformation hereof shall be deemed valid until
reduced to writing and signed by the parties hereto.

25. Governing Law.

THIS LEASE AND THE RIGHTS AND DUTIES OF THE PARTIES ARISING OUT OF THIS LEASE SHALL BE GOVERNED BY
AND CONSTRUED, ENFORCED, AND

Storage Lease (Enterprise Products NGL Marketing)

8

 

PERFORMED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, AS THE
SAME MAY BE AMENDED FROM TIME TO TIME, WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW
PROVISION OR RULE THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE
STATE OF TEXAS.

WITH RESPECT TO ANY SUIT, ACTION, OR PROCEEDING ARISING OUT OF OR RELATING TO THIS LEASE, EACH
PARTY HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE FEDERAL AND STATE COURTS (AS
APPLICABLE) LOCATED IN HARRIS COUNTY, TEXAS, AND TO ALL COURTS COMPETENT TO HEAR AND DETERMINE
APPEALS THEREFROM, AND WAIVES ANY OBJECTIONS THAT A SUIT, ACTION OR PROCEEDING SHOULD BE BROUGHT IN
ANOTHER COURT AND ANY OBJECTIONS TO INCONVENIENT FORUM.

THE PARTIES FURTHER AGREE THAT, IN THE EVENT OF A LAWSUIT ARISING OUT OF THE PERFORMANCE OF THIS
LEASE, THE PREVAILING PARTY SHALL BE ENTITLED TO RECOVER ITS REASONABLE ATTORNEYS’ FEES AND COURT
COSTS, INCLUDING FEES FOR EXPERT WITNESSES, FOR PROSECUTING OR DEFENDING ANY SUCH LAWSUIT FROM THE
PARTY NOT PREVAILING.

26. Other Provisions.

This Lease may be executed in counterparts, each of which shall be deemed to be an original and all
of which, taken together shall constitute the same agreement.

This Lease shall be construed as jointly drafted by the parties according to the language as a
whole and not for or against any party.

In the event one or more of the provisions contained in this Lease shall be held to be invalid or
legally unenforceable in any respect under applicable law, the validity, legality or enforceability
of the remaining provisions hereof shall not be affected or impaired thereby. Each of the
provisions of this Agreement is hereby declared to be separate and distinct.

Nothing contained in this Lease shall be construed to create an association, trust, partnership, or
joint venture or impose a trust, fiduciary or partnership duty, obligation, or liability on or with
regard to any party.

This Lease is for the sole benefit of the parties and their respective successors and permitted
assigns, and shall not inure to the benefit of any other person whomsoever, it being the intention
of the parties that no third person shall be deemed a third party beneficiary of this Lease.

27. Default.

A party will be in default if it: (a) breaches this Lease, and the breach is not cured within
thirty (30) days after receiving written notice of such default (or alleged default) from the other
party

Storage Lease (Enterprise Products NGL Marketing)

9

 

specifying the nature of the breach; (b) becomes insolvent; or (c) files or has filed against
it a petition in bankruptcy, for reorganization, or for appointment of a receiver or trustee. In
the event of default, the non-defaulting party may terminate this Lease upon notice to the
defaulting party. For the avoidance of doubt, Lessor’s failure to perform any of the services for
any reason other than force majeure will be deemed a breach of this Lease to which subsection (a)
of this Section 27 applies.

28. Early Termination.

This Lease may be terminated and canceled by Lessor if not accepted and returned to Lessor by
Lessee within fifteen (15) days from the date hereof.

[Signature page follows]

Storage Lease (Enterprise Products NGL Marketing)

10

 

DATED this 23rd day of January, 2007.

	 	 	 	 	 
	LESSOR	 	 
	 
	 	 	 	 
	MONT BELVIEU CAVERNS, LLC	 	 
	 
	 	 	 	 
	BY:
	 	/s/ Gil H. Radtke 
	 	 
	 

	 	Gil H. Radtke
	 	 
	 

	 	Senior Vice President and Chief Operating Officer
	 	 
	 
	 	 	 	 
	LESSEE	 	 
	 
	 	 	 	 
	ENTERPRISE PRODUCTS OPERATING L.P.	 	 
	 
	 	 	 	 
	By:  Enterprise Products OLPGP, Inc., its general partner

	 	 
	 
	 	 	 	 
	BY:

	 	/s/ Richard H.
Bachmann 

	 	 
	 

	 	Richard H. Bachmann
	 	 
	 

	 	Executive Vice President, Chief
Legal Officer and Secretary
	 	 

Storage Lease (Enterprise Products NGL Marketing)

11

 

SCHEDULE 1

STORAGE LEASE

(ENTERPRISE NGL MARKETING)

STORAGE FEES.

(A) For the first Lease Year, Lessee shall pay Lessor annual rent at the rate of *** per barrel per
year (the “Base Storage Rental Rate”) for the volume leased under this Lease.

Commencing with the first day of the second Lease Year, and on the first day of each subsequent
Lease Year, the annual rent shall be adjusted as follows: one-half of the Base Storage Rental Rate
shall remain fixed, and one-half shall be revised annually based on a seasonally adjusted implicit
price deflator in order to determine a new rental rate known as the “Adjusted Rental Rate.” The
Adjusted Rental Rate shall be determined in accordance with the following formula:

*** per barrel + [*** per barrel X Annual Index / Base Index] = Adjusted Rental Rate

			
	     Where:	 	“Base Index” is the final seasonally adjusted implicit price deflator figure for the
calendar year 2004 under the Gross Domestic Product column of the “Implicit Price
Deflators for Gross Domestic Product” table (1996=100); and

“Annual Index” is the final seasonally adjusted implicit price deflator
figure for the calendar year ending immediately before the Lease Year for
which the adjustment is being determined, said figure being in the same
column, table and survey as the Base Index.

The Adjusted Rental Rate shall be rounded off to the fourth decimal place and shall become
effective on the first day of each Lease Year. In no event will the Adjusted Rental Rate ever be
less than the Base Storage Rental Rate.

For example, in calculating the Adjusted Rental Rate, which shall apply under this Lease, assume in
the second Lease Year the Base Index is 113.2, and the Annual Index is 115.2. Under these facts
the Adjusted Rental Rate would be as follows:

*** per barrel + [*** per barrel X 115.2 / 113.2] =

*** per barrel + [*** per barrel X 1.0177] =

*** per barrel + *** per barrel = *** per barrel

The Adjusted Rental Rate of *** would become effective on the first day of the second Lease Year
and would continue until the last day of the second Lease Year, with a new Adjusted Rental Rate to
apply starting on the first day of the third Lease Year, and so on.

Storage Lease (Enterprise Products NGL Marketing)

 

 

THROUGHPUT & FACILITY FEES

The throughput fee of *** (the “Base Throughput Fee”), the Facility Fee, and the fee on In Well
Deliveries will be subject to the same escalation factors as those used to compute the Adjusted
Rental Rate; provided, however, the total Base Throughput Fee for both receipts and deliveries will
be escalated (the “Adjusted Throughput Fee(s)”). The total amount of the In Well Delivery Fee and
the Facility Fee will be escalated.

For example, using the assumed numbers from the prior example, the Adjusted Throughput Fee for the
period commencing October 1, 2007 would be ***, calculated as follows: 115.2/113.2 = 1.0177; 1.0177
X *** = ***. In no event will any of the adjusted fees ever be less than their base fee.

The “Implicit Price Deflators for Gross Domestic Product” are available in the Survey of Current
Business as published monthly by the Bureau of Economic Analysis of the U.S. Department of
Commerce. Subscriptions to the Survey of Current Business are maintained by the Government
Printing Office, an agency of the U.S. Congress. If said Survey fails to publish a necessary price
deflator figure or ceases to be published, any replacement index published by or on behalf of the
United States government shall be substituted, and if there is no such substitute index, the
parties shall promptly agree on a replacement survey or index or, if they cannot agree, either
party shall be entitled to submit the matter of a replacement index to arbitration under the
commercial arbitration rules of the American Arbitration Association.

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: 5/1/02

EXHIBIT A

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

E/P MIX (COMMERCIAL ETHANE)

(Ethane/Propane)

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Methane

	 	 	ASTM D-2163
	 	 	1.5   Liq. Vol.% max.
	Carbon Dioxide

	 	 	ASTM D-2504
	 	 	1000 ppm wt. max.
	Ethane

	 	 	ASTM D-2163
	 	 	75.0 - 82.0 Liq. Vol.%
	Propane

	 	 	ASTM D-2163
	 	 	25.0 Liq. Vol.% max. 
	Ethylene

	 	 	ASTM D-2163
	 	 	4.0 Liq. Vol.% max.
	Butanes & Heavier

	 	 	ASTM D-2163
	 	 	0.8 max. (1)
	Total Sulfur

	 	 	ASTM D-4045
	 	 	30 ppm wt. max.
	Corrosion, Copper Strip

	 	 	ASTM D-1838
	 	 	No. 1

NOTE ON TEST METHODS: Method numbers listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

Contaminants -The specification defines only a basic purity for this product. This product is to
be free of any contamination that might render the product unusable for its commonly used
applications. Specific contaminants include (but are not limited to) dirt, rust, scale, and all
other types of solid contaminants, caustics, chlorides, heavy metals, and oxygenates.

1. Anything heavier than C3 will be valued as Propane.

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	Phil Winter
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: September 1, 1998

EXHIBIT A

(HP iC4)

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

HIGH PURITY ISOBUTANE

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Propane & Lighter

	 	 	ASTM D-2163
	 	 	1.0 Liq. Vol.% max.
	Isobutane

	 	 	ASTM D-2163
	 	 	98.0 Liq. Vol.% min.
	Normal Butane

	 	 	ASTM D-2163
	 	 	1.8 Liq. Vol.% max.
	Isopentane & Heavier

	 	 	ASTM D-2163
	 	 	0.1 Liq. Vol.% max.
	Total Olefins

	 	 	ASTM D-2163
	 	 	2000 ppm wt. max.
	Dienes and Acetylenic
Compounds

	 	 	ASTM D-2712
	 	 	50 ppm wt. max.
	Total Sulfur

	 	 	ASTM D-4045
	 	 	10 ppm wt. max.
	Water Content

	 	 	VISUAL
	 	 	No Free Water
	Chlorides

	 	 	MB 251
	 	 	<1 ppm wt. max.

NOTE ON TEST METHODS: Method numbers listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	 
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: 5/1/02

EXHIBIT A

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

STANDARD GRADE ISOBUTANE

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Propane & Lighter

	 	 	ASTM D-2163
	 	 	3.0 Liq. Vol. % max.
	Isobutane

	 	 	ASTM D-2163
	 	 	96.0 Liq. Vol. % min.
	Normal Butane & Heavier

	 	 	ASTM D-2163
	 	 	4.0 Liq. Vol. % max.
	Total Sulfur

	 	 	ASTM D-4045
	 	 	140 ppm wt. max.
	Water Content

	 	 	VISUAL
	 	 	No Free Water
	Vapor Pressure at 100° F

	 	 	ASTM D-1267
	 	 	70 psig max.
	Corrosion, Copper Strip

	 	 	ASTM D-1838
	 	 	No.1

NOTES ON TEST METHODS: Method numbers listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

Contaminants -The specification defines only a basic purity for this product. This product is to
be free of any contamination that might render the product unusable for its commonly used
applications. Specific contaminants include (but are not limited to) dirt, rust, scale, and all
other types of solid contaminants, caustics, chlorides, heavy metals, and oxygenates.

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	Bob Sanders
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: 5/1/02

EXHIBIT A

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

ISOM GRADE NORMAL BUTANE

RECEIPT SPECIFICATIONS ANALYSIS

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Propane & Lighter

	 	 	ASTM D-2163
	 	 	0.35 Liq. Vol.% max.
	Isobutane

	 	 	ASTM D-2163
	 	 	6.0 Liq. Vol.% max.
	Normal Butane

	 	 	ASTM D-2163
	 	 	94.0 Liq. Vol.% min.
	Pentanes & Heavier

	 	 	ASTM D-2163
	 	 	1.5 Liq. Vol. % max.
	Hexanes & Heavier

	 	 	ASTM D-2163
	 	 	0.050 Liq. Vol. % max.
	Total Olefins

	 	 	ASTM D-2163
	 	 	0.35 Liq. Vol. % max.
	Butadiene

	 	 	ASTM D-2163
	 	 	0.01 Liq. Vol. % max.
	Total Oxygenates

	 	 	UOP-845
	 	 	50.0 ppm wt. max.
	     Methanol

	 	 	UOP-845
	 	 	50.0 ppm wt. max.
	     IPA & Heavier Alcohols

	 	 	UOP-845
	 	 	5.0 ppm wt. max.
	     MTBE & Other Ethers

	 	 	UOP-845
	 	 	2.0 ppm wt. max.
	     Other Oxygenates

	 	 	UOP-845
	 	 	5.0 ppm wt. max.
	Total Sulfur

	 	 	ASTM D-4045
	 	 	140 ppm wt. max.
	Water Content

	 	 	VISUAL
	 	 	No Free Water
	Fluoride

	 	 	UOP-619
	 	 	1.0 ppm wt. max.
	Vapor Pressure at 100°F

	 	 	ASTM D-1267
	 	 	50 psig max.
	Volatile Residue:
	 	 	 	 	 	 
	     Temperature @ 95% evaporation

	 	 	ASTM D-1837
	 	 	+36°F max.
	Corrosion, Copper Strip

	 	 	ASTM D-1838
	 	 	No.1

Storage Lease (Enterprise Products NGL Marketing)

 

 

NOTE ON TEST METHODS: Method numbers listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

Contaminants -The specification defines only a basic purity for this product. This product is to
be free of any contamination that might render the product unusable for its commonly used
applications. Specific contaminants include (but are not limited to) dirt, rust, scale, and all
other types of solid contaminants, caustics, chlorides, heavy metals, and oxygenates.

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	Phil Winter
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: 7-10-02

EXHIBIT A

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

PETROCHEMICAL GRADE GASOLINE PRODUCT

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Normal Butane & Lighter

	 	 	ASTM D-2177
	 	 	6.0 Liq. Vol.% max.
	Total Sulfur

	 	 	ASTM D-3120
	 	 	1000 ppm wt. max.
	Water Content

	 	 	VISUAL
	 	 	No Free Water
	Vapor Pressure at 100°F

	 	 	ASTM D-323
	 	 	14.0 RVP max.
	End Point

	 	 	ASTM D-86
	 	 	375°F max.
	Color, Saybolt Number

	 	 	ASTM D-156
	 	 	+25 min.

NOTE ON TEST METHODS: Method numbers listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

Contaminants -The specification defines only a basic purity for this product. This product is to
be free of any contamination that might render the product unusable for its commonly used
applications. Specific contaminants include (but are not limited to) dirt, rust, scale, and all
other types of solid contaminants, caustics, chlorides, heavy metals, and oxygenates.

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	Phil Winter
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: 5/1/02

EXHIBIT A

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

PROPANE

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Vapor Pressure, PSIG @ 100°F

	 	 	ASTM D-1267
	 	 	208 max.
	Volatile Residue:
	 	 	 	 	 	 
	     Temperature @ 95% evaporation

	 	 	ASTM D-1837
	 	 	-37°F max.
	Corrosion, Copper Strip

	 	 	ASTM D-1838
	 	 	No. 1
	Total Sulfur

	 	 	ASTM D-4045
	 	 	123 ppm wt. max.
	Propylene

	 	 	ASTM D-2163
	 	 	5.0 Liq. Vol.% max.
	Propane

	 	 	ASTM D-2163
	 	 	90.0 Liq. Vol.% min.
	Butanes & Heavier

	 	 	ASTM D-2163
	 	 	2.5 Liq. Vol.% max.
	Water Content

	 	 	VISUAL
	 	 	No Free Water
	Residual Matter
	 	 	 	 	 	 
	     Residue on evaporation
of 100 ml. max.

	 	 	ASTM D-2158
	 	 	0.05 ml.
	     Oil Stain Observation

	 	 	 	 	 	Pass

NOTES ON TEST METHODS: Method numbers listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

Contaminants -The specification defines only a basic purity for this product. This product is to
be free of any contamination that might render the product unusable for its commonly used
applications. Specific contaminants include (but are not limited to) dirt, rust, scale, and all
other types of solid contaminants, caustics, chlorides, heavy metals, and oxygenates.

Storage Lease (Enterprise Products NGL Marketing)

 

 

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	Bob Sanders
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: 5/01/02

EXHIBIT A

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

PURITY ETHANE

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Methane

	 	 	ASTM D-2163
	 	 	3.0 Liq. Vol.% max.
	Ethane & Ethylene

	 	 	ASTM D-2163
	 	 	95.0 Liq. Vol.% min.
	Propane & Heavier

	 	 	ASTM D-2163
	 	 	3.5 Liq. Vol.% max.
	Corrosion, Copper Strip

	 	 	ASTM D-1838
	 	 	No. 1
	Total Sulfur

	 	 	ASTM D-4045
	 	 	30 ppm wt. max.
	Water Content

	 	 	VISUAL
	 	 	No Free Water
	Carbon Dioxide

	 	 	ASTM D-2504
	 	 	1000 ppm wt. in Liq. max.

NOTES ON TEST METHODS: Method number listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

Contaminants -The specification defines only a basic purity for this product. This product is to
be free of any contamination that might render the product unusable for its commonly used
applications. Specific contaminants include (but are not limited to) dirt, rust, scale, and all
other types of solid contaminants, caustics, chlorides, heavy metals, and oxygenates.

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	Bob Sanders
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

Reissue Date: 5/1/02

EXHIBIT A

	 	 	 
	

	 	ENTERPRISE PRODUCTS OPERATING L.P.

NATURAL GASOLINE

	 	 	 	 	 	 	 
	COMPONENT	 	TEST METHODS	 	SPECIFICATIONS
	Normal Butane & Lighter

	 	 	GPA-2177
	 	 	6.0 Liq. Vol.% max.
	Total Sulfur

	 	 	ASTM D-3120
	 	 	1000 ppm wt. max.
	Water Content

	 	 	VISUAL
	 	 	No Free Water
	Vapor Pressure at 100°F

	 	 	ASTM D-323
	 	 	14.0 RVP max.
	End Point

	 	 	ASTM D-86
	 	 	375°F max.
	Corrosion, Copper Strip

	 	 	ASTM D-130
	 	 	No. 1
	Doctor Test

	 	 	ASTM D-4952 or GPA 1138
	 	 	Negative
	Color, Saybolt Number

	 	 	ASTM D-156
	 	 	+25 min.

NOTE ON TEST METHODS: Method numbers listed above, beginning with the letter “D,” are
American Society for Testing and Materials (ASTM), Standard Test Procedures. The most recent year
revision for the procedures will be used.

Contaminants -The specification defines only a basic purity for this product. This product is to
be free of any contamination that might render the product unusable for its commonly used
applications. Specific contaminants include (but are not limited to) dirt, rust, scale, and all
other types of solid contaminants, caustics, chlorides, heavy metals, and oxygenates.

	 	 	 	 	 	 	 
	Specification Committee Approval:

	 	Wayne Mullins
	 	Bob Sanders
	 	James Gernentz
	 

	 	 
	 	 
	 	 
	 

	 	Quality Control
	 	Business Management
	 	Operations

Storage Lease (Enterprise Products NGL Marketing)

 

 

8/3/05 revision

EXHIBIT “B”

EPOLP MEASUREMENT PROCEDURES

ARTICLE I

METERING EQUIPMENT

Section 1.1 General.

	A.	 	Natural gas liquids or other products delivered or received by EPOLP shall be measured by
either volumetric or mass measurement procedures using a turbine or Coriolis meter.

	B.	 	Chemical grade propylene, refinery grade propylene, propane, isobutane, normal butane,
commercial butane and natural gasoline shall be measured by mass or volumetric measurement
procedures.

	C.	 	Raw mix, ethane, ethane propane mix, and butane gasoline mix shall be measured by mass
measurement procedures.

	D.	 	Polymer grade propylene shall be measured utilizing volumetric or mass measurement procedures
and API Manual of Petroleum Measurement Standards, (API MPMS) Chapter 11.3.3.2
to determine calculated density and report mass.

	E.	 	The measuring station shall be installed in such a manner that a minimum back-pressure of 50
psig above the product vapor pressure at maximum operating temperature is maintained at all
times. Measurement accuracy shall not be impeded by the effects of pulsation created by pumps
or other sources.

	F.	 	All equipment employed in metering and sampling shall be approved as to the type, materials
of construction, method of installation, and maintenance by all parties involved in the
custody transfer of products. Due consideration shall be given to the operating pressure,
temperature, and characteristics of the product being measured.

	G.	 	Reference to any API, ASTM, GPA or similar publication shall be deemed to encompass the
latest edition, revision or amendments thereof.

Section 1.2 Meters.

	A.	 	Turbine meters shall be installed and operated in accordance with the API MPMS,
Chapter 5, Sections 3 and 4. Each meter shall be proven when initially placed into service
using a ball or piston-type or small volume prover in accordance with the API MPMS,
Chapter 4, and Chapter 12 Section 2.

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	B.	 	Coriolis meters shall be installed and operated in accordance with the API MPMS,
Chapter 5, Section 6. Each meter shall be proven when initially placed into service using a
ball or piston-type or small volume prover in accordance with the API MPMS, Chapter 4,
and Chapter 12, Section 2. The prover will be additionally equipped with a densitometer
installed and proved in accordance with the API MPMS, Chapter 14, Section 6. The meter
proving shall be an Inferred Mass Proving in accordance with API MPMS, Chapter 5,
Section 6.9.1.7.2.

	C.	 	Meter proving frequency shall be in accordance with Section 2.3.C below. The meter shall be
proven immediately prior to and after any meter maintenance is performed.

Section 1.3 Densitometers.

	A.	 	Densitometers with frequency output shall be installed and proved in accordance with the
API MPMS, Chapter 14, Section 6. The frequency output may be driven directly into a
flow computer capable of internally converting frequency to corrected flowing density in
gm/cc, or to a separate frequency converter and into the flow computer as a 4-20 ma signal.
Proving is to be by entrapping a sample of the flowing stream at system conditions in a
double-walled high-pressure vessel known as a pycnometer. The connections for the pycnometer
shall be installed in the same manner as those of the densitometer. Thermowells shall be
installed to allow monitoring of the inlet and outlet temperatures. Accuracy of the
densitometer shall be verified at the time of the meter proving or when accuracy is in
question. The accuracy of the densitometer shall be within +/- 0.001 gm/cc over its entire
range and repeatable to +/- 0.0005 gm/cc.

	B.	 	For chemical grade propylene measurement utilizing a turbine meter, a calculated density may
be used in lieu of a densitometer by using the API MPMS, Chapter 11.3.3.2 method for
pure propylene and correcting it for 92 to 96 percent purity by applying a correction factor
of 0.9987 to the prover mass volume at each proving.

Section 1.4 Temperature and Pressure Transmitters. Temperature and pressure transmitters
shall be verified at the time of the meter proving using a certified thermometer and reference gage
respectively to ensure current readings are within +/-0.2 °F and +/- 1.0 psi. A calibration shall
be performed every 6 months. All verification and calibration data shall be supplied to the
customer. Accuracy of these transmitters shall be +/- 0.05 % of scale.

Section 1.5 Flow Computers. Flow computers shall be capable of accepting turbine pulses
from a turbine meter transmitter or mass pulses from a Coriolis meter transmitter and signals from
the pressure, temperature and density transmitters. The computer shall convert, as required, and
totalize these signals into gross volume, mass, and net volume. For net volume determinations, the
computer shall utilize the latest ASTM, API and GPA tables for temperature, pressure and specific
gravity corrections that are applicable to the product being measured. The weight of water shall be
as provided in the latest version of GPA 2145.

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Section 1.6 Composite Sampling Systems. Composite sampling systems shall be installed and
operated in accordance with GPA Standard 2174. The composite sampler shall be operated to collect
flow-proportional samples only when there is flow through the meter. These samples shall be
accumulated in and removed from single-piston cylinders with mixing capability.

Storage Lease (Enterprise Products NGL Marketing)

 

 

ARTICLE II

ACCOUNTING AND MEASUREMENT PROCEDURES

Section 2.1 Custody Transfer Tickets.

	A.	 	EPOLP shall furnish to the customer daily (0700 to 0700) custody transfer tickets unless
otherwise provided for by separate agreement, for products measured on a volumetric basis.
The ticket shall identify the product and state the net volume in barrels of product measured.

	B.	 	For streams that are measured on a mass basis, custody transfer tickets shall be furnished
stating the total mass measured in pounds. Total pounds mass shall then be converted to pounds
of each component (if required) based on its weight fraction of the analysis of the product
removed from the composite sampler for the same time period in which the mass was totalized.
The component pounds shall then be converted to equivalent gallons of each component (if
required) utilizing the calculation procedure outlined in GPA Standard 8173. The component
density in a vacuum shall be in accordance to GPA Standard 2145. Component gallons shall be
further reduced to barrels. Unless otherwise provided for by separate agreement, custody
transfer tickets for mass-measured products shall be generated on a weekly or batch basis. An
unfinished batch shall be closed out at 0700 hours on the first day of the calendar month,
unless otherwise provided for by separate agreement.

Section 2.2 Measurement Basis.

	A.	 	Mass Measurement.

	 	1.	 	Inferred mass measurement shall be accomplished utilizing a flow-proportional
composite sampler, turbine meter, densitometer and flow computer to convert gross
volumetrically measured barrels using density in gm/cc at flowing conditions to total
pounds mass according to the following formula:

     TotalPounds = GrossBBLS x MeterFactor x FlowingDensity(gm/cc) x 350.506987

	 	 	 	350.506987 is a conversion factor to convert density in gm/cc to pounds /bbl.

     For polymer grade propylene the composite sampler and densitometer are not required.

	 	2.	 	Direct mass measurement shall be accomplished by utilizing a flow-proportional
composite sampler, a Coriolis meter, Coriolis transmitter, and a flow computer to
convert mass pulses from the Coriolis transmitter into pounds. Measured pounds mass is
calculated according to the following formula:

	 	 	 	 	 
	MeasureMass =

	 	MeterPulses
 

KFactor
	 	x MeterFactor 

     For polymer grade propylene the composite sampler is not required.

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	B.	 	Volumetric Measurement.

	 	1.	 	Volumetric measurement shall be accomplished utilizing a flow computer, turbine
meter, and temperature and pressure transmitters. A “fixed” specific gravity at 60
oF and vapor pressure at 100 oF may be entered into the flow
computer in the case of “purity” products, if agreed by both parties. Temperature and
pressure shall be referenced to the proper API, ASTM and GPA Tables to calculate and
totalize net barrels. An optional densitometer and flow-proportional composite sampler
may be installed. If a densitometer is installed, the flow computer shall convert the
density signal at flowing conditions in gm/cc to specific gravity at 60 oF
and use GPA TP-15 to determine EVP (Equilibrium Vapor Pressure).
	 
	 	2.	 	On the basis of laboratory analysis, components of mixed streams may be
determined by multiplying the totalized net volume by the liquid volume percent of each
component, if so stipulated by contract.

	 	 	The following shall be utilized by the flow computer to reduce gross barrels to net barrels.
	 
	 	 	For Temperature Reduction. API/ASTM/GPA Technical Publication TP-25 Table 24E shall
be used when measuring propane, isobutane, normal butane, natural gasoline and mixes of the
above.
	 
	 	 	For Pressure Reduction (Compressibility).

	 	a.	 	API MPMS, 11.2.2 (GPA 8286) shall be used for measuring propane,
isobutane, normal butane, and mixes of the above.
	 
	 	b.	 	API MPMS, 11.2.1 shall be used when measuring natural gasoline.

	 	 	Temperature and Pressure Correction. API MPMS, 11.3.3.2 Subroutine “PROPYL”
shall be used for temperature and pressure correction when measuring propylene and as a
ratioed factor based upon propylene content in propane/propylene mix.

Section 2.3 Provings and Tolerances.

	A.	 	Principles. During the proving cycle, turbine pulses (volumetric) from the turbine
meter transmitter or mass pulses from the Coriolis transmitter are accumulated. Dividing the
accumulated pulses by the prover volume or prover mass generates a “K Factor” in terms of
volume or mass, respectively. After the initial proving, this “K Factor” is entered into the
flow computer along with a meter correction factor of 1.0000. After subsequent provings, one
can choose to adjust the “K Factor” or the meter correction factor. If the choice is made to
adjust the “K Factor,” then the meter correction factor remains at 1.0000. If the adjustment
is made at the meter correction factor, then the established “K Factor”

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	 	 	remains the same. The
densitometer factor is entered into the flow computer to correct flowing density in gm/cc as
determined by results of a pycnometer test. The pycnometer shall be installed so that flow
through the vessel shall assure proper purging thus allowing temperature and pressure
equalization with the densitometer being proved. Maximum allowable temperature differential
between the contents in the pycnometer and the densitometer shall be no greater than +/- 0.2
oF. The pressure shall be equal to that of the densitometer at time of removal.
	 
	B.	 	General.

	 	1.	 	Meter provings, calibration of instruments, and maintenance of measurement
equipment shall normally be performed by EPOLP personnel, but these functions may be
delegated to responsible third-party contractors under the direction of an EPOLP
representative.
	 
	 	2.	 	A customer’s witness signature does not constitute the approval of the use of
out-of-tolerance equipment, but said signature does attest to the validity of the
proving report.

	C.	 	Proving Intervals. Each meter shall be proven when initially placed into service.
Subsequent provings shall be made every thirty (30) days, unless in accordance with the
API MPMS, Chapter 5.3.9.5.2 the consistency of the meter factor, as evidenced in meter
factor control charts, may allow the proving interval to be extended to a maximum of 60 days.

	D.	 	Meter Factor.

	 	1.	 	Volumetric meter proving calculations shall be in accordance with API
MPMS, Chapter 12.2. The average of five (5) consecutive prover runs shall be taken
to establish an initial or new meter factor, provided that the five (5) proving runs
are within 0.0005 (0.05 %) of each other and the meter factor is within 0.0025 of the
previous meter factor under like operating conditions.
	 
	 	2.	 	The new meter factor shall be used after each successful proving if it meets
the above proving criteria.
	 
	 	3.	 	If the new meter factor deviates from the previous meter factor under like
operating conditions by more than plus or minus 0.0025, then one half (1/2) of the
volume measured since the previous proving shall be corrected using the new meter
factor. If the time of malfunction can be determined by historical data, then the
volume measured since that point in time shall be corrected using the new meter factor.
The new meter factor shall not be used to correct volumes measured more than
thirty-one (31) days prior to the new proving.

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	 	4.	 	No work shall be performed on the measuring element of a turbine meter without
first proving the meter. If any work is performed, a new meter factor shall be
established.
	 
	 	5.	 	If the new meter factor deviates more than 0.0025 but less than 0.0050 from the
previous meter factor, the field representatives of EPOLP and the customer shall
determine the corrective action, if any, to be taken.
	 
	 	6.	 	If the new meter factor deviates 0.0050 or more, the element shall be removed
and inspected. If there is build-up on the internals, then the element shall be
cleaned and the meter re-proved. If excessive wear is found, then the element shall be
repaired or replaced and the meter re-proved to establish a new initial meter factor.
After a 24-hour wear-in period, the meter shall be re-proved and if the meter factor
changes more than +/- 0.0025 from the new initial meter factor, then one-half (1/2) of
the volume measured shall be corrected using the latest meter factor.
	 
	 	7.	 	The measurement technician shall record all required corrections to measured
volumes and shall describe the findings, method of repair, and calculations used in
making the correction on the meter proving report. A correction ticket for the amount
of the correction shall be issued.

	E.	 	Density Factor. The proving intervals, tolerances, repairs and methods of correction
are the same as those provided for in Section 2.3.D above, except that the average of two (2)
successive pycnometer provings shall establish product flowing density, provided the two (2)
successive provings agree within 0.0005 (0.05%).

     Section 2.4 Custody Measurement Station Failure.

	A.	 	If a failure occurs on a custody measurement station or the station is out of service while
product is being delivered, then the volume shall be determined or estimated by one of the
following methods in the order stated:

	 	1.	 	By using data recorded by any check measuring equipment that was accurately
registering; or
	 
	 	2.	 	By correcting the error if the percentage error can be ascertained by
calibrations, tests, or mathematical calculations; or
	 
	 	3.	 	By comparison with deliveries made under similar conditions when the
measurement station was registering accurately; or
	 
	 	4.	 	By using historical pipeline gain/loss.

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Section 2.5 Sampling Procedures.

	A.	 	Flow proportional composite samples shall be removed from the composite sampler at the same
time the meter is read and a custody ticket issued. Samples of finished LPG products streams
shall be analyzed in accordance with ASTM D-2163 and raw mix stream shall be analyzed by GPA
2186 extended analysis for C6+ streams.

	B.	 	Three samples shall be taken from the composite sampler. One sample shall be retained by
EPOLP for analysis, the second sample shall be retained by the customer for analysis, and the
third shall be held as a referee. If EPOLP has taken custody, its sample shall be analyzed
and the analysis used to account for transfer. If the customer has taken custody, its sample
shall be analyzed and the analysis used to account for transfer. If the customer and EPOLP
are in disagreement, then the referee sample shall be taken to a mutually agreed upon
laboratory which shall analyze the sample in accordance with the proper GPA Standard. This
analysis shall be accepted by the customer and EPOLP as final and conclusive for proportions
and components contained in the stream. Charges for such referee sample shall be borne by the
customer and EPOLP equally.

	C.	 	Referee samples shall be held for a period of thirty (30) days from the date of sampling.

	D.	 	If a malfunction of the sampling occurs resulting in no sample being taken or in an
unrepresentative sample being obtained, the following procedure shall be utilized in the order
stated.

	 	1.	 	The sample collected by any on-stream back-up sampling device that has
extracted a sample in proportion to the volume delivered shall be used.
	 
	 	2.	 	An average of the composite samples taken over a mutually agreed time frame
{not to exceed the last three (3) months of properly sampled deliveries} shall be used.
	 
	 	3.	 	Daily grab samples shall to be used for the time in question.

Section 2.6 Definitions.

	A.	 	“Day” shall mean a period of twenty-four (24) consecutive hours commencing at a local time
agreed on by all parties involved.

	B.	 	“Gallon” shall mean a United States Gallon of 231 cubic inches of liquid at sixty degrees
Fahrenheit (60 oF) and at the equilibrium vapor pressure of the liquid.

	C.	 	“Barrel” shall mean forty-two (42) United States Gallons.

	D.	 	“EPOLP” shall mean Enterprise Products Operating L.P.

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Section 2.7 Technical Publications.

	A.	 	Manual of Petroleum Measurement Standards, American Petroleum Institute, Washington,
D.C.:

	 	1.	 	API Chapter 1, “Definitions.”
	 
	 	2.	 	API Chapter 4, “Proving Systems.”
	 
	 	3.	 	API Chapter 5.3, “Measurement of Liquid Hydrocarbons by Turbine Meters.”
	 
	 	4.	 	API Chapter 5.4, “Accessory Equipment for Liquid Meters.”
	 
	 	5.	 	API Chapter 5.6, “Measurement of Liquid Hydrocarbons by Coriolis Meters.”
	 
	 	6.	 	API Chapter 9.2, “Pressure Hydrometer Test Method for Density or Relative
Density.”
	 
	 	7.	 	API Chapter 11.2.2, “Compressibility Factors for Hydrocarbons: 0.350 — 0.637
Relative Density (60 oF/60 oF) and –50 oF to 140
oF Metering Temperature.”
	 
	 	8.	 	API 11.2.1, “Compressibility Factors for Hydrocarbons: 0-90o API
Gravity Range.”
	 
	 	9.	 	API Chapter 11.3.3.2, “Propylene Compressibility.”
	 
	 	10.	 	API Chapter 12.2, “Calculation of Liquid Petroleum Quantities.”
	 
	 	11.	 	API Chapter 14.6, “Continuous Density Measurement.”
	 
	 	12.	 	API Chapter 14.7, “Standard for Mass Measurement of Natural Gas Liquids.”
	 
	 	13.	 	API Chapter 14.8, “Liquefied Petroleum Gas Measurement.”
	 
	 	14.	 	API Chapter 21.2, “Flow Measurement — Electronic Liquid Measurement.”

	B.	 	API/ASTM/GPA Technical Publication TP-25 Table 24E, “Correction of Volume to 60 °F Against
Relative Density 60 °F/60 °F.”

	C.	 	ASTM-D-1250 (Table 24), “Volume Corrected to 60 oF and equilibrium vapor
pressure.”

	D.	 	ASTM-D-2163 “Standard Test Method for Analysis of Liquid Petroleum (LP) Gases and Propene
Concentrates by Gas Chromatography.”

	E.	 	GPA Standard 2140, “Liquefied Petroleum Gas Specifications and Test Methods.”

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	F.	 	GPA Standard 2145, “Table of Physical Constants of Paraffin Hydrocarbons and Other Components
of Natural Gas.”

	G.	 	GPA Standard 2174, “Method of Obtaining Hydrocarbon Fluid Samples Using a Floating Piston
Cylinder.”

	H.	 	GPA Standard 2177, “Method for the Analysis of Demethanized Hydrocarbon Mixtures Containing
Nitrogen and Carbon Dioxide by Gas Chromatography.”

	I.	 	GPA Standard 2186, “Method for the Extended Analysis of Hydrocarbon Mixtures Containing
Nitrogen and Carbon Dioxide by Temperature Programmed Gas Chromatography.”

	J.	 	GPA Standard 8173, “Method for Converting Natural Gas Liquids and Vapors to Equivalent Liquid
Volumes.”

	K.	 	GPA Standard 8182, “Tentative Standard for the Mass Measurement of Natural Gas Liquids.”

	L.	 	References to any API, GPA, ASTM or similar publications shall be deemed to encompass the
latest edition, revision or amendment thereof.

Storage Lease (Enterprise Products NGL Marketing)

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