Loading...
HomeMy WebLinkAbout84-25 - C-2428 - Oil Operations of Facilities in West NewportRESOLUTION NO. 84 -25 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH AWARDING A CONTRACT FOR OIL OPERATIIONS TO SAMPSON OIL COMPANY CONCERNING OIL FACILITIES IN WEST NEWPORT (C -2428) WHEREAS, pursuant to Notice inviting bids for work, and is specifications heretofore adopted concerning the operation of oil facilities in West Newport, bids were received and publicly opened and declared on January 11, 1984, at 10:00 a.m. , in the office of the City Clerk; and WHEREAS, after review of all bids, it appears that SAMPSON OIL COMPANY presented the most favorable bid, based upon criteria previously approved by the City Council. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newport Beach that the bid of SAMPSON OIL COMPANY, in the amount of $4,300 per month, for the operation and maintenance of City -owned oil facilities in West Newport, plus an additional $50.00 per hour for engineering work, be and hereby is accepted, pursuant to the terms and conditions of that certain Oil Operat- ing Agreement between the parties, a copy of which is attached hereto as Exhibit "D" and incorporated herein by reference. BE IT FURTHER RESOLVED, that the Mayor and City Clerk are hereby authorized and directed to execute the Oil Operating Agreement between the parties referred to herein, all in accor- dance with the specifications, bid and this award, on behalf of the City of Newport Beach. BE IT FURTHER RESOLVED that the City Clerk be and herebyis is directed to furnish an executed copy of this Resolution awarding said contract for services to SAMPSON OIL COMPANY, the successful bidder thereon. is ADOPTED this 26th dz ATTEST: City Clerk — /pr RSP /Sampson 0 AGREEMENT FOR OPERATING CITY OWNED OIL FACILITIES IN WEST NEWPORT THIS AGREEMENT is made and entered into this day of March, 1984, by and between the CITY OF NEWPORT BEACH, a Charter City and Municipal Corporation, hereinafter "City," and SAMPSON OIL COMPANY, hereinafter "Operator." W I T N E S S E T H WHEREAS, City owns 16 tideland oil wells and related oil production facilities in West Newport, the location of which is reasonably and accurately depicted on Exhibit "A" attached hereto and incorporated herein; and WHEREAS, pursuant to Section 7058 et seq., of the California Public Resources Code, City expressed its intention to enter into an Oil Operating Agreement by inviting bids thereon pursuant to Resolution No. 83 -127, adopted by the City Council on December 12, 1983; and WHEREAS, after review of bids submitted pursuant to require- ments. of said Notice a copy of which is attached hereto as Exhibit "B ", City found and determined that Operator presented the most favorable bid based upon application of the following criteria: 1. Professional qualifications; 2. Monthly service fee and hourly rates; 3. Capability of firm to accomplish the work in conformance with the requirements of the City of Newport Beach; • 4. Specialized experience of the firm in the type of work required; 5. Past demonstration of performance similar to governmen- tal agencies or with private industry; and 6. Familiarity with geographical area of the project; and EXHi91'r WHEREAS, on January 11, 1984, City accepted the bid proposal of Sampson Oil Company, a copy of which is attached hereto as Exhibit "C" and incorporated herein; NOW, THEREFORE, in consideration of the foregoing, the par - ties hereto agree as follows: 1. GENERAL .(a) City engages Operator to perform professional ser- vices hereinafter described for the compensation hereinafter stated. (b) Operator agrees to perform said services upon the .terms and conditions hereinafter set forth. 2.. SCOPE OF WORK (a) Duties of Operator included in the monthly service fee include: (i) Performance of` all work necessary to man- 2 age, operate, produce, protect and main- tain City owned tideland wells, tank farm, pipelines and related oil production facilities in accordance with oil field practices. (ii) Respond to all emergencies and provide for personnel to safely and continuously oper- ate the oil facilities 24 hours per day, seven days per week. (iii) Provide full -time, qualified, pump opera- for with field truck and pay all costs, direct and indirect, relating to the . employment of the pumper and use of the truck. (iv) Provide City with detailed recommenda- tions, cost estimates and technical advice to improve production, maintenance and se- curity for all oil facilities. 2 (v) Maintain accurate, daily records of all production, treatment of oil, cut and tem- perature of oil, deliveries and field tes- ting on forms provided by City. (vi) Recommend, schedule, coordinate and in- spect the work performed by all oil field service contractors. (vii) Schedule, supervise and coordinate the transfer of all oil and gas sold and gauge and measure promptly the quantity of oil and gas produced, saved and shipped. (viii) Maintain detailed records and submit signed invoices for all material, equip- ment and services rembursable by City. (ix) Perform individual well tests at least every six months, indicating rate of production and quantities of oil, water and sand produced. (x) Furnish small hand tools required in nor- mal operations. (xi) Be responsible for, and pay all of, State and Federal income taxes- on Operators' compensation and all transportation, administrative and overhead costs. 3. DUTIES OF CITY .(a) Pay Operator a monthly service fee of $4,300 for operation and.maintenance of City owned oil produc- tion facilities; (b) Pay Operator $50.00 per hour, not to exceed $400.00 per day, for providing City requested extra engineering work; (c) City to -pay nothing to Operator for extra administrative and office work provided in response to City requests; 3 (d) Pay for all major repair and improvement work per - formed on oil wells and related production facili- ties by oil field service contractors and vendors; • (e) Unless otherwise specified, pay for all utilities, chemicals, materials and supplies required to oper- ate and maintain oil wells and related production facilities; (f) Be responsible for the marketing of all oil and gas produced; (g) Obtain all operating permits; (h) Pay all property taxes on the production and mining of oil and gas. 4. SPECIAL PROVISIONS (a) Assignment No agreement or portion thereof may be assigned without the specific, written consent of City. (b) Authority of City City shall have final authority in all matters effecting work. (c) Term The term of this Operating Agreement shall be for a period of two years. (d) Cancellation The Operating Agreement may be cancelled at anytime by City without liability for damages when, in City's opinion, Operator is not complying in good faith. (e) Inspection . All work and operations shall, at all times, be subject to inspection and approval by City. All materials and work shall be of the highest quality and shall be in accordance with good oil field and construction practices. 4 (f) Protection of Environment All oil production facilities are located in, and situated near, environmentally - sensitive wetland habitats. Operator shall exercise every reasonable precaution to protect the wetlands, channels and bodies of water from pollution of any kind. (g) Safety The highest possible priority is to be placed on conducting a safe operation. The Operator shall comply with the Safety Orders of the State Division of Industrial Safety and all other applicable safety laws, ordinances and regulations. (h) Cooperation with Others Operator shall cooperate and take direction from City and its authorized representatives. City has a "non- exclusive" property right to operate and maintain its oil production facililties. Other oil companies and utilities have operating rights over the same area. Operator will be required to fully cooperate with others and to schedule and coordin- ate work so as not to interfere with the rights of others. (i) Use of City Personnel It is the policy of City not to use City personnel in connection with normal operations of oil fields, and every effort shall be made by Operator to accomplish the required work by using outside contractors and laborers. (j) Labor Operator shall comply with all applicable Federal, State and Local labor laws. 11 • • (k) Liability Insurance Operator shall furnish City with a policy or Certificate of Liability Insurance in which City is named as the insured, or as an additional insured. The coverage shall provide the following minimum limits: Bodily Iniurv: $250,000 each person $5000000 each occurrence $500,000 aggregate products completed operations Property Damage: $100,000 each occurrence $250,000 aggregate A combined single limit policy with aggregate limits in the amount of $1,000,000 will be considered equivalent to the required minimum limits. Insurance companies shall be assigned Policyholders' Rating B (or better) by the latest edition of Best's Rey Rating Guide: Property Casualty. All liability insurance policies shall bear an endorsement or shall have attached a Rider which pro- vides that, in the event of expiration or proposed con - cellation of such policies, for any reason whatsoever, City shall be notified by Registered Mail, Return Re- ceipt Requested, giving a sufficient time before the date thereof to comply with any applicable law or statute but, in no event, less than 30 days before ex- piration or cancellation is effective. The cost of insurance shall be included in Operator's monthly ser- vice fee.. 5. INDEMNIFICATION AND HOLD HARMLESS (a) Operator shall save, keep, hold harmless and defend City, its officers and agents from all claims, com- plaints, damages, costs or expenses in law or equity that may,. at any time, arise or be set up because of damages to property, or of personal injury received by N 0 reason of, or in the course o, performing work which may be caused by any wilful or negligent act or omission by Operator, or subcontractors. any of Operator's employees or 6. WORKERS' COMPENSATION INSURANCE (a) Operator shall comply with Section 3800 of the Labor Code by securing, paying for and maintaining in full force and effect for the duration of this Agreement com- plete Workers' Compensation Insurance and shall furnish a. Certificate of Insurance to City. City, its officers or employees, will not be responsible for any claims in law or equity occasioned by failure of Operator to com- ply with terms of this paragraph. (b) All Workers' Compensation insurance policies shall bear an endorsement, or shall have attached a Rider, which provides that in the event of expiration or proposed cancellation of such policies, for any reason whatso- ever, City shall be notified, by Registered Mail, not less that 30 days before expiration or cancellation is effective. The cost of this insurance shall be included in Operator's monthly service fee. 7. EXTRA WORK (a) When City determines that required work is not covered by the monthly service fee, it shall be classified as "extra work." If the price for extra work is not cover- ed in the Proposal Form and cannot be agreed upon, City will pay for extra work based on the accumulation of costs of labor, materials, tools and equipment, plus a 158 markup for all overhead and profit. Vendor's invoices shall be submitted with each request for pay- ment. Operator shall not proceed with any "extra work" unless and until cost estimates have been prepared and authorized by City. 7 8. AUTHORITY OF OTHER AGENCIES (a) All well heads and production facilities are located in the County of Orange, and the operation, at all times, will be subject to the rules and regulations of the County of Orange Environmental Management Agency. (b) All oil reservoirs are located in tidelands under the Pacific Ocean, and the operation, at all times, will be subject to the authority of the State Lands Commission of the State of California. IN WITNESS WHEREOF, the parties hereto have executed this AGREEMENT on the date first above written. ATTEST: City Clerk APPROVED AS TO FORM: City Attorney RDG /dt AGB /Qil CITY CITY OF NEWPORT BEACH By: Mayor OPERATOR SAMPSON OIL COMPANY By: Renick Sampson 3 i I 1 I 1 I 9 .:.. (o ,a °a,' no- _ ,�i, ! ..� \• -�. ^�8° T l F � V4 4 R NOTICE INVITING PROPOSALS Sealed proposals for the operation of 16 oil. wells and related oil production, and storage facilities owned by the City of Newport Beach, will be received at the office of the City Clerk, 3300 Newport Boulevard, Newport Beach, CA 92663 until 10:00 A.M. on the 11th day of January, 1984 at which time such proposals shall be opened and read. ® The facilities are located in the area commonly known as "West Newport," and north of Pacific Coast Highway. The term of the proposal will be two years. The proposal will relate only to oil field operations, and will convey no rights to the operator other than compensation for work performed. Other terms and conditions will be as set forth in the Request for Proposal, together with such additional terms and conditions as may be deemed necessary or appropriate by the City Council to fully protect the interests of the City of Newport Beach. The proposal shall specify the monthly service fees to be paid to the operator for the duties required to be performed pursuant to the agreement. The award of the operating agreement will be made to the lowest responsible bidder, as determined by the City Council of the City of Newport Beach. Qualified prospective bidders may obtain one set of bid documents at no cost at the office of the City Clerk, 3300 Newport Boulevard, Newport Beach, CA 92663. ,For further information, call Robert Dixon at 640 -2221. i ON 0 CITY OF NEWPORT BEACH UTILITIES DEPARTMENT PROPOSAL FORM To the Honorable City Council City of Newport Beach Io3300 Newport Boulevard P..0. Box 1768 Newport Beach, CA 92663 -3884 Gentlemen: `..1 The undersigned declares that he has carefully examined the site and the oil production facilities, has read the Request for Proposal, and hereby proposes to furnish all services and do all the work required to operate and maintain the oil production facilities in accordance with the Request for Proposal, and will take in full payment therefor the following prices for the work: . 1. Operate and maintain the City owned oil production facilities for a monthly service fee of $_4,300.00 per month. 2. Provide requested extra engineering work for an hourly rate of $-5o. no per hour,. not to exceed $400.00 per day. 3. Provide requested extra administrative and office work for an hourly rate of $ n.no per hour. PVe"ary 7, 0 T_ Authorized, S gnature 301 Ultimo Long Beach, Ca. 90814 Address 213 498 -3797 Tnlnnhnnu No mhor