HomeMy WebLinkAboutC-2918 - Sale of Oil, Tidelands Oil Well,EOTT
ENERGY CORP.
March 1, 1994
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
City of Newport Beach
Attn: Jeff Staneart
3300 Newport Blvd.
Newport Beach, CA 92663
Re: Those contracts and agreements listed
on Exhibit A hereto (whether one or
more, and as amended and supplemented,
the "Contracts ")
Dear Sir or Madam:
It is anticipated that the business of EOTT Energy Corp.
("EOTT") will be the subject of a public offering in March
of this year or shortly thereafter. This will be
accomplished through a merger in which the business of EOTT
that includes the Contracts will become owned by EOTT Energy
Operating Limited Partnership, a Delaware limited
partnership (the "Partnership "). EOTT is the sole general
partner of the Partnership.
The merger is intended to bring in public investors to
the business, but is not intended to affect our longstanding
relationships with our customers, suppliers and other trade
partners. Although the legal entity that technically owns
the business will change, the faces will stay the same.
EOTT will continue to operate the business as the general
partner of the Partnership and substantially all of the
current officers and employees of EOTT will remain officers
and employees after the merger. Moreover, as general
partner of the Partnership, EOTT will continue to be liable
for the debts and obligations of the business of the
Partnership.
The assets of the business of EOTT, including the
Contracts, will vest in the Partnership as a result of the
merger. The Partnership will thus become the successor to
the rights and obligations of EOTT under the Contracts
pursuant to the merger documents. As this transaction moves
forward, it is possible that there will be minor changes in
the structure of the transaction in a manner that will not
be adverse to you.
P.O. Box 4666 Houston, Texas 772104666
a
Because we value
to consent to this
counterparts of this
returning one copy
stamped envelope. If
11, 1994, we will
transaction.
our relationship with you, we ask you
transaction by executing each of the
letter in the space provided below and
to the undersigned in the enclosed
we do not receive your reply by March
assume that you approve of this
If you have any questions relating to this letter in any
way, please call Bob Devine at (310) 437 -3577.
Very truly yours,
EOTT ENERGY CORP.
Brn
y lV�
Ph111 J. 114wk
President
APPROVED:
City of Newport each
By: 7 d
Name: KEVIN MuRp}{y
Title: CITy MANAGER
f: /hdr /enr100 /23018 /docs /trsa /lt /a07olp.doc
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9
EOTT ENERGY CORP.
February 23, 1994
Dear EOTT Energy Corp. Customer:
C_7
EOTT Energy Corp. (11EOTT11) wishes to announce that our parent
company, Enron Corp., is restructuring EOTT's business into
limited partnership form. we will be operating as EOTT Energy
Operating Limited Partnership and its subsidiaries effective in mid
to late March, 1994. EOTT Energy Corp., which will be 100% owned
by Enron Corp., will serve as the general partner of these new
entities. This reorganization represents the third master limited
partnership ("MLP") involving Enron Corp. companies, the other MLPs
being Enron Liquids Pipeline, L.P. and Northern Border Partners,
L.P., both of which are traded on the New York Stock Exchange.
EOTT Energy Operating Limited Partnership will be a well
capitalized, financially strong entity. This financial strength
will include ownership of all of the assets of the current EOTT and
a consolidated balance sheet having approximately $153 million of
equity capital and no long term debt. Importantly, this
restructuring will not change our business relationship with any of
our valued customers. EOTT Energy Operating Limited Partnership
and the existing "EOTT team" will continue to provide the same
reliable customer service to which you have grown accustomed.
As our customer, you are EOTT's most valuable asset. Please call
your marketing representative or our toll -free customer service
line if we can be of further service to you or if you have any
questions. Our representatives and their telephone numbers are
listed on the reverse side for your convenience.
Very truly,
Philip J. Hawk
President
PJH /emk
mm✓02029"Ar
P.O. Box 4666 Houston, Texas 77210-4666
EOTT Energy Corp.
Business Contact List
Marketing Representative
Location
Telephone Number
Harry King
Sassier, IA
800n3748523
Vic Porter
Calgary, AB, Canada
403 /266 -3688
Ransom Curtis
Lafayette, LA
318/237-M31
Ted Parrish
Oklahoma City, OK
405/324.64%
Mark Ildbaat
Corpus Christi, TX
512/289 -1210
Mike Watson
Dallas, Tx
214/395 -7701
Kirby Black
Houston, T%
7131752 -2033
Jay Harbison
Mickey Miller
Mike D'danore
Midland, TX
9151682 -3761
John Glidewell
Greg Wheeler
Ken Wise
San Antonio, T%
210/3404208
Steve Comstock
Denver, CO
303/629 -5044
Ted McCurdy
Bud Andiss
Chanute, KS
316/431 -9650
Dick Guinotte
Michael Campbell
Karen
Calgary, AB, Canada
403 /266 -3688
Halpen
Stephen Powell
J'® Gravatt
Bakersfield, CA
805/5884355
Mike Nemer
Houston, T%
713/993 -5200
Director, SMARTT Pricing
Customer Service Line
800/872-9019
0 1/
CITY OF NEWPORT BEACH
OFFICE OF THE CITY CLERK
P.O. BOX 1768, NEWPORT BEACH, CA 92658 -8915
(714) 644 -3005
TO: FINANCE DIRECTOR
FROM: CITY CLERK
DATE: September 8, 1992
SUBJECT: Contract No. C -2918
Description of Contract Agreement for Sale of Oil
Effective date of Contract July 1, 1992
Authorized by Minute Action, approved on June 22, 1992
Contract with Enron Oil Trading & Transportation Company
Address 3025 Gibson St.
Bakersfield, CA 93308
Amount of Contract (See Agreement)
"
Wanda E. Raggio
City Clerk
WER:pm
Attachment
3300 Newport Boulevard, Newport Beach
DALE: July 1, 1992
Oil, TraWg & Transportation CgWpany
3025 Gibson St.
Bakersfield, California 93308
021II2i1L'1' ND: 73851
C -2N
Effective as of; July 1, 1992
The undersigned "Seller ", whether one or more, hereby represents, warrants and declares that it is
authorized to deliver and sell (and receive 100% of the proceeds for) all of the "oil" produced
from the following:
Lease(s): City of Newort Beach Lease #47345
MO �� • � S!6�Ir_`t er.N7tauia.li
This Crude Oil Purchase Agreement ( "Agreement ") between City of N Ort Beach
hereinafter c a l l e d I ISeller+l, and Enxtal Oil Trading & TLa11Sp0r Ori U2rPMV, hereinafter c a l led
I9BLge0', sets forth the terms and conditions under which Seller agrees to sell and deliver, and
Buyer agrees to purchase and receive, the crude oil and /or condensate ( "oil ") from the above described
lease(s), to wit:
I TEM: Effective July 1, 1992 through October 1, 1992 and continuing thereafter
until terminated by either party giving not less than a ninety (90) day
written notice of cancellation. Such notice shall commence on the 1st
day of the month following the actual date of notice and conclude
ninety (90) days later.
II TYPE CF OIL: Newport Beach crude oil, typically 21.0 gravity containing less
than 3 % B.S. 8 W.
III QUANPPII': Approximately 165 barrels per day of typical Newport Beach
Field crude oil.
IV DEUVEEOC: Delivery shall be made from designated shipping tanks and /or through
sates meters into EOTT'S designated carrier from the
City of Newport Beach Lease #47345 in the Newport Beach Field.
Title shall pass from City of Newport Beach
to Enron Oil Trading 8 Transportation Company as crude oil passes
through the outlet flange of the tank.
V PRICE: Chevron's posting for the Newport Beach Field
LESS $.35 per barrel for transportation deduct.
VI PAYPMU: Payment shall be made on the twentieth (20th) of the month following
the month of delivery.
VII DOC MEDIIS:
Any documents pertaining to contracts
following addresses:
.S:
Enron Oil Trading 8 Transportation Cc
Attn: Crude Oil Sales Department
3025 Gibson Street
Bakersfield, California 93308
division orders. or invoices shalt be sent to the
Enron Oil Trading 8 Transportation Co.
Attn: Division Order Dept./Crude Oil Acct.
P.O. Box 1188
Houston, Tx. 77251 - 1188
The general provisions on the reverse side of this Agreement are made a part hereof for all purposes.
E 3CN OIL TPADIM & TI SPOHI71= 03MPM
(MUER )) /
s�
PRUUM V 3.MUR PR]2VM: Robert E. Devine
TITLE: CITY "?SAGER
8131192
TAR ID# 9$%000"751
TME: Director, Lease Crude Acquisitions
DATE: July 1, 1992
Please ret= cm aoeaxW original to Enrm Oil Trading & Trwisportation ompwW to the attenticn
of the above- sicpved representative.
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SNOISIAOIM lYS3N30
03
•
•
June 22, 1992
CITY COUNCIL
ITEM NO.
TO: Mayor & Members of the City Council
FROM: Utilities Department
C -Z9 /Jp
SUBJECT: AGREEMENT FOR SALE OF OIL
NEWPORT BEACH TIDELANDS OIL WELLS
ENRON OIL TRADING & TRANSPORTATION
RECOMMENDATIONS:
DISCUSSION:
!UN 2 2 1992
1
�a
APPROVED
COMPANY, INC.
Authorize the City Manager to execute an
Agreement for the sale of oil to Enron Oil Trading &
Transportation Company, Inc. on behalf of the City.
The City operates 16 oil wells in West Newport. The wells
produce oil from State Tidelands. They produce approximately 4,500
barrels of oil each month. The Utilities Department is responsible for the
administration of the oil wells which are operated by Sampson Oil Company
under contract to the City. Oil from the wells is sold and revenues
supplement the City's "Tide & Submerged Lands Fund ".
The City's current contract for the sale of oil was negotiated in
1987 with an ongoing "evergreen" renewal clause. Under the Agreement, the
City sold oil to West Newport Oil Company (Armstrong Petroleum) at a base
price for oil, adjusted by a periodic oil industry price posting which fluctuates
with the world oil market. Armstrong Petroleum approached the City to
impose higher charges for transport of oil from the City's storage facility. The
proposed transportation charge is higher than the typical oil industry rate.
This action prompted staff
seek a more favorable sales Agreement.
the City Council authorized termination
directed staff to negotiate a new oil sale
prospective oil purchase companies.
to ask the Council for authority to
At the meeting of May 11th, 1992,
of the current Agreement and
agreement with a prequalified list of
Five oil companies were prequalified as competent and financially
stable prospective purchasers of the City's oil. Each was asked to submit price
quotations and terms for purchase of the City's oil. Those companies were:
1. Chevron U.S.A. Products Company
2. Mobil Oil Corporation
3. Texaco
4. Enron Oil Trading & Transportation Company
5. Armstrong Petroleum
. ge 2
fgreement for Sale of oil
Enron Company, Inc.
June 22, 1992
The City's Oil Field Operating Contractor, Sampson Oil
Company, assisted with the prequalification process. This process identified
oil companies who are financially solvent, have a responsible track record of
operations and handling oil products and are well established companies
doing business in California.
A summary of the price and terms submitted from the five
prequaliffed companies follows:
Firm
oII posting current
Gravity
Transportadon.
Net Price
post sheet on category adjustment
cbaW
per BBL
per BBL
Armstrong
Chevron Anaheim Sugar $14.20
Chevron $0.15 x 4
($0.78)
$14.02
Texaco
Texaco Signal Hill $17.80
Texaco ($0.15 x 8)
($0.65)
$15.95
Chevron
declined to quote -
- -
-
no price
Enron
Chevron Newport (other) $16.05
Chevron $0.15 x 4
($0.60)
$16.05
Mobil
declined to quote -
_ _
-
no price
Based on the quotations received the most favorable terms have
been presented by the Enron Oil Trading & Transportation Company. The
current net price the City would receive for the sale of its oil will be $16.05
per barrel. The represents an increase in the price currently received by the
City of approximately $1.03 per barrel. Over the course of a year this will yield
an additional $55,620 in revenue to the Tide & Submerged Lands Fund.
The proposed Agreement with Enron Oil Trading &
Transportation Company is attached for reference and review.
Affirmative action on the is item will allow the new agreement
to become effective July 1St, 1992. Staff recommends approval.
Respectfully submitted,
.._JF*r- SrA jEAfkr
Jeff Staneart, P.E.
(Acting) Utilities Director
JS: sdi
Attachment: Agreement for Sale of Oil
• ENROMh
Oil Trading & Transpor on Company
3025 Gibson St.
Bakersfield, California 93308
EAM: OMMUCT 1D: 72069
Effegtive w of: 1992
The undersigned "Seller ", whether one or more, hereby represents, warrants and declares the, it is
authorized to deliver and sett (and receive 100% of the proceeds for) ALL of the "oil" produced
from the following:
14,A (S): City of Nsq=t Beath La3se #47345
a �M� • al R�r �� •�. �r R V. at
(M OM PE14CEMO a'GRERMC
This Crude Oil Purchase Agreement ( "Agreement ") between C1 Of Beads
herinafter celled " iiPi n, and Eh= Oil Trading fi �Bl hereinafter called
.Muyeel, sets forth the terms and conditions under which Seller agrees to sett and deliver, and
Buyer agrees to purchase and receive, the crude oil and /or condensate ( "oil") from the above described
lease(s), to wit:
I 'lEFM- Effective 1992 through 1992 and continuing thereater
until terminated by either party giving not less than a ninety (90)
day notice of Cancellation. Such notice shall commence on the
Tat day of the month following the actual date of notice and conclude
ninety (90) days later.
II TYPE OP OIL: Newport Beach crude oil, typically 21.0 gravity containing less
than 3% B.S. & W.
III Q[YiNDLSC: Approximately 165 barrels per day of typical Newport Beach Field
crude oil.
IV EEL=: Delivery shall be made from designated shipping tanks and /or
through sales meters into EOTT'S designated carrier from the
City of Newport Beach Lease #47365 in the Newport Beach Field.
Title shall pass from the City of Newport Beach to E r on oil
Trading & Transportation Company as crude oil passes through
the outlet flange of the tank.
V PfaCE: Chevron's posting for the Newport (other) Field, LESS
5.60 per barrel for transportation deduct.
VI PA3D1'FSS: Payment shalt be made on the twentieth (20th) of the month
following the month of delivery.
VII DOQ2MM:
Any documents pertaining to contracts, division orders, or invoices shalt be sent to the
following addresses:
O1VIIY=: DIVISION ORIWINMICTS•
Enron Oil Trading It Transportation Co. Enron Oil Trading & Transportation Co.
Attn: Crude Oil Sales Department Attn: Division Order Dept. /Crude Oil Acct.
3025 Gibson Street P.O. Box 1188
Bakersfield, California 93308 Houston, Ix. 77251 - 1188
VIII ^PSCM PI77V1,91O5:
The general provisions on the reverse side of this Agreement are made a part hereof for ell purposes.
EM;M OIL T UMM 6 11YSSICRU7ff9N 0Z11171M
(SEELM
BY: BY:
PRIR=: PRi2UD: Robert Devine
T=: TITLE: Director, Lease Crude Acquisitions
EAW: DA1£: , 1992
v u..
Please retLim one ambled original to E]i m Oil Tiarb.itq 6 Trai>spoitatiffii ('lnpaxgt m the attation
3 of the above- signeid xc�esartat ve.
F
0
Chevron CALIFORNIA AND ALASKA
Chevron U.S.A. Products Company
575 Market Street, San Francisco, CA 94105 Crude Oil Price Bulletin 92 -CA11
Effective 7:00 a.m., May 29, 1992, and subject to change without notice, Chevron U.S.A.
Inc. will pay the following prices per barrel for crude ail and condensate delivered for its account
into the custody of its authorized carrier or receiving agent.
' BELRIDGE HVY (UNDER 28 °)
POSTED PRICE
15.40
POSTED PRICE
FIELDS
GRAVITY
$ /BBL
FIELDS
GRAVITY
$ /BBL
` ALASKA (COOK INLET)
35.0
17.30
MCK1 TRICK
13.0
15.25
" ALFERITZ ANTICLINE
19.0
16.30
' MIDWAY SUNSET
13.0
15.25
" ALISO CANYON
22.0
16.50
' MONTALVO (COLONIA)
15.0
14.45
` ALONDRA
21.0
16.85
' MONTALVO (MCGRATH)
27.0
17.40
ANTELOPE HILLS
21.0
16.60
MONTEBELLO
22.0
16.95
` ASPHALTO
33.0
18.20
MOUNTAIN VIEW
27.0
17.40
" BELGIAN ANTICLINE
35.0
18.45
" NEWPORT (ANAHEIM SUGAR)
18.0
14.20
' BELMONT OFFSHORE
28.0
17.55
NEWPORT(OTHER)
15.0
16.05
' BELRIDGE HVY (UNDER 28 °)
14.0
15.40
NORTH TEJON
34.0
18.35
" BELRIDGE LT (OVER 28 °)
31.0
17.95
OXNARD
26.0
17.25
' BRADLEY CANYON
12.0
14.25
'
PACOIMA
34.0
18.35
` BUENA VISTA HILLS
26.0
17.25
PIONEER
39.0
18.85
" CAL CANAL
40.0
18.95
"
PLACERITA- NEWHALL
12.0
15.15
` CANFIELD RANCH
31.0
17.95
"
PLEASANT VALLEY
24.0
17.00
' CARPINTERIA (OFFSHORE)
25.0
16.40
PLEITO CREEK
17.0
15.80
" CASMALIA
12.0
13.85
'
PT ARGUELLO (ONSHORE)
19.0
11.50
' CASTAIC HILLS
33.0
18.20
PT PEDERNALES (ONSHORE)
16.0
14.20
' CAT CANYON
12.0
14.05
'
PYRAMID HILLS
16.0
15.65
" COALINGA
14.0
15.40
"
RAILROAD GAP
22.0
16.70
" COLES LEVEE
31.0
17.95
"
RAISIN CITY
20.0
16.45
' CRESCENT HEIGHTS
27.0
17.65
'
RAMONA
18.0
16.20
' CYMRIC
12.0
15.15
RICHFIELD
19.0
16.55
' DEL VALLE
23.0
16.85
'
RIO VIEJO
31.0
17.95
' EAST COYOTE
23.0
17.10
'
ROSEDALE
31.0
17.95
' EDISON HVY (30° & UNDER)
18.0
15.95
ROSEDALE RANCH
20.0
16.45
EDISON LIGHT (31° & OVER)
40.0
18.95
ROUND MOUNTAIN
17.0
15.80
EDNA (ARROYO GRANDE)
14.0
15.40
SALT LAKE (SAN VICENTE)
23.0
16.60
" EL SEGUNDO
25.0
17.40
SANTA CLARA (OFFSHORE)
28.0
15.05
' FRUITVALE
16.0
15.65
SANTA FE SPRINGS
30.0
18.05
" GREELEY
32.0
18.05
SANTA MARIA VALLEY
12.0
14.25
' GUIJARRAL HILLS
35.0
18.45
SEAL BEACH
25.0
17.40
" HUNTINGTON BEACH
19.0
16.55
STRAND
32.0
18.05
' INGLEWOOD
21.0
17.10
TEJON GRAPEVINE
21.0
16.60
" JACALITOS
32.0
18.05
"
TEJON HILLS
28.D
17.55
' KERN RIVER
13.0
15.25
TORRANCE
20.0
16.70
" KETTLEMAN HILLS
34.0
18.35
"
VENICE BEACH
21.0
16.35
' LAS CIENEGAS
29.0
17.90
VENTURA AVENUE
28.0
17.30
' LONG BEACH (SIGNAL HILL)
27.0
17.65
WEST COYOTE
28.0
17.80
' LOS ANGELES DOWNTOWN
38.0
19.00
WHEELER RIDGE
20.0
16.45
" LOST HILLS
35.0
18.45
WHITTIER
22.0
16.95
' MCDONALD ANTICLINE
37.0
18.65
WILMINGTON
17.0
16.30
Denotes change
Y
YOWLUMNE 31.0 17.95