The Gas Sale Agreement serves as the primary commercial instrument for natural gas transactions in the United States. This document is essential when establishing long-term or significant gas supply arrangements, incorporating federal requirements under the Natural Gas Act, state-specific regulations, and FERC requirements. The agreement typically covers crucial elements including quality specifications, delivery obligations, pricing mechanisms, and risk allocation, while ensuring compliance with relevant environmental and safety regulations.
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1. Parties: Identification and details of the seller and buyer
2. Background: Context of the agreement and relationship between parties
3. Definitions: Key terms used throughout the agreement including regulatory and technical definitions
4. Gas Specifications: Quality and composition requirements for the gas
5. Quantity: Agreed volumes, including minimum and maximum take obligations
6. Price and Payment: Pricing mechanism, payment terms, and invoicing procedures
7. Delivery Point: Specified location for gas transfer and title passage
8. Term and Termination: Duration of the agreement and termination provisions
9. Force Majeure: Circumstances excusing performance and notification requirements
10. Representations and Warranties: Standard and specific warranties regarding capacity, authority, and compliance
11. Regulatory Compliance: Compliance with Natural Gas Act, FERC regulations, and other applicable laws
1. Transportation: Details of gas transportation arrangements and pipeline capacity rights
2. Marketing Rights: Rights to market or resell gas and territorial restrictions
3. Storage: Storage arrangements, responsibilities, and facilities usage
4. Environmental Compliance: Specific environmental obligations and reporting requirements
5. Trading Provisions: Specific provisions for gas trading and exchange
1. Schedule A - Quality Specifications: Detailed technical specifications for gas quality and testing methods
2. Schedule B - Measurement Procedures: Details of measurement methods, equipment, and calibration requirements
3. Schedule C - Price Adjustment Mechanism: Formula and procedures for price adjustments and market price references
4. Schedule D - Delivery Points: Technical details, maps, and specifications of delivery points
5. Schedule E - Form of Nominations: Standard forms for gas nominations and scheduling procedures
6. Schedule F - Operating Procedures: Day-to-day operational procedures and communication protocols
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