HomeMy WebLinkAboutPR 23916: REIMBURSEMENT AGREEMENT PALNG, LIQUEFIED NATURAL GAS FACILITY (POLICE) ,40%.... ,
4
Cit', of
41
ort rthtt
T�
INTEROFFICE MEMORANDUM
Date: September 18, 2024
To: Ronald Burton, City Manager 7°
From: Timothy W. Duriso, Chief of Police q A 6,7I61
RE: Direct Cost Reimbursement Agreement between the City of Port Arthur Police
Department and PALNG.
Nature of the Request:
The Port Arthur LNG (PALNG) of Houston, Texas contacted the Port Arthur Police Department
regarding an agreement. PALNG explained that the Federal Energy Regulatory Commission now
requires facilities, such as their facility currently under construction, to enter into a Direct Cost
Reimbursement Agreement with local first responder organizations. As a result of their contact,
PALNG requested to enter into an agreement with the Port Arthur Police Department.
Staff Analysis,Considerations:
The Direct Cost Reimbursement Agreement submitted by PALNG through PALNG Operator
Company, LLC, formalizes the reimbursement of any direct costs incurred by the Port Arthur
Police Department in response to incidents at their facility, in accordance with Section 7 of the
Industrial District Agreement with PALNG. The city benefits from this agreement because
PALNG has agreed to reimburse all costs associated with an extended responses to the PALNG
facility by the Police Department, which includes personnel, equipment, and supplies.
Additionally, PALNG would reimburse training costs associated with any training or education
programs PALNG may request Police Department personnel to attend.
Recommendations:
The Police Department recommends the City Council's approval of this agreement between
PALNG and the City of Port Arthur. The recommendation is based on what is reimbursable to
the City of Port Arthur for all services provided to PALNG to incidents at their facility.
Budget Considerations:
There is no budget impact regarding this proposed resolution and the agreement as offered is
beneficial to the City of Port Arthur.
P.R. No. 23916
09/17/2024 JLH
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE CITY MANAGER TO
ENTER INTO A DIRECT COST REIMBURSEMENT
AGREEMENT WITH THE PORT ARTHUR POLICE
DEPARTMENT AND PORT ARTHUR LNG, THROUGH PALNG
OPERATOR COMPANY, LLC, AS MANDATED BY THE
FEDERAL ENERGY REGULATORY COMMISSION (FERC)
FOR ITS LIQUEFIED NATURAL GAS FACILITY
WHEREAS, pursuant Section 7 of the Industrial District
Agreements with Port Arthur LNG, the City' s Police Department
may provide Police Support and other emergency response services
to the Port Arthur LNG facility to protect the health and welfare
of the public at no cost or expense to the City; and
WHEREAS, pursuant to the statutory requirements of the
Federal Energy Regulatory Commission, Port Arthur LNG must enter
into a Direct Cost Reimbursement Agreement with those First
Responder agencies that provide direct support to their
facility; and
WHEREAS, Port Arthur LNG has communicated this requirement
to the City' s Police Department; and
WHEREAS, Port Arthur LNG has provided a Direct Cost
Reimbursement Agreement, attached as Exhibit "A" , for review and
consideration;
WHEREAS, this agreement does not have a negative budgetary
impact on the City' s Police Department .
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF PORT ARTHUR:
rr
Section 1. That the facts and opinions in the preamble are
true and correct .
Section 2 . That the City Council hereby authorizes the
City Manager to enter into a Direct Cost Reimbursement Agreement
with Port Arthur LNG, through PALNG Operator Company, LLC, in
substantially the same form, attached hereto as Exhibit "A" .
Section 3 . That a copy of the Resolution shall be spread
upon the Minutes of the City Council .
READ, ADOPTED AND APPROVED on this day of , A.D. ,
2024 , at a Regular Meeting of the City Council of the City of
Port Arthur, Texas, by the following vote :
AYES:
Mayor:
Councilmembers :
NOES :
Thurman Bartie,
Mayor
ATTEST:
Sherri Bellard,
City Secretary
APPROVED AS TO FORM:
Roxann Pais Cotroneo,
City Attorney
APPROVED F ADMINISTRATION:
Ronald Burt CPM,
City Man er
Timo W. Duriso,
Chi f of Police
Exhibit "A"
4)
Chris Fortenberry
Vice President of Operations
Port Arthur LNG Port Arthur LNG
2300 Hwy 365,Suite 400
Nederland,TX 77627
Cell 832.507.2469
Email cfortenberry@sempraglobal.com
August 28, 2024
Timothy Duriso
Chief of Police
Port Arthur Police Department
P.O. Box 1089
Port Arthur,Texas 77640
Subject: Direct Cost Reimbursement Agreement
Dear Chief Duriso:
Please find attached Direct Cost Reimbursement Agreement for your review.
We recognize that these types of agreements may not be in place with other manufacturers,
but FERC has specified that this will be a requirement going forward. My team and I will reach
out in the next couple of weeks to discuss and seek feedback regarding this request. Thanks in
advance for your support.
Very Truly Yours,
c Fo onto rvy
Chris Fortenberry
Vice President of Operations
Port Arthur LNG
Port Arthur LNG is not the same company as the California utilities,San Diego Gas&Electric Company(SDG&E)or Southern California Gas Company
(SoCalGas),and Port Arthur LNG is not regulated by the California Public Utilities Commission.
Port Arthur LNG
Direct Cost Reimbursement Agreement
This Agreement (the "Agreement") is made effective as of the day of , 2024 (the
"Effective Date")between:
(1) PALNG OPERATOR COMPANY,LLC,a limited liability company formed under the laws of
Delaware("PALNG");and
(2) Port Arthur Police Department,a municipal police department formed under the laws of the
State of Texas("Emergency Responder");
each sometimes referred to individually herein as a"Party"and collectively as the"Parties
INTRODUCTION
(A) PALNG and its affiliates are developing a liquefied natural gas facility in Port Arthur,Texas (the
"LNG Terminal") which is regulated in part by the Federal Energy Regulatory Commission
("FERC").
(B) Under Section 3A(e) of the Natural Gas Act, 15 U.S.C. § 71 7b-1(e), PALNG has developed an
emergency response plan in consultation with the United States Coast Guard and state and local
agencies.
(C) The Emergency Response Plan includes a cost-sharing plan for direct cost reimbursements to state
and local agencies with an interest in the security and safety at the LNG Terminal and surrounding
areas and in proximity to vessels that serve the facility(together,the"Port Arthur Site").
(D) Under the Emergency Response Plan,the Emergency Responder has been identified as a provider
of emergency response services in relation to emergency incidents occurring at the Port Arthur Site.
(E) This Agreement is to formalize PALNG's agreement to reimburse direct costs incurred by the
Emergency Responder in connection with its response to emergency incidents at the Port Arthur
Site.
AGREEMENT
1. In the event that the Emergency Responder provides emergency response services at the Port Arthur
Site in accordance with the Emergency Response Plan, PALNG will reimburse the Emergency
Responder, as agreed by PALNG Leadership and the Emergency Responder, for the actual
documented costs of personnel,equipment,facilities,and related resources used by the Emergency
Responder which are in excess of the costs typically incurred by the Emergency Responder's during
the first Operational Period of the response at existing FEMA rates,unless mutually accepted costs
associated with these resources have been pre-identified in writing.
2. PALNG further agrees to compensate the Emergency Responder for any training or other education
that PALNG may request the Emergency Responder's personnel to receive for the proper and
adequate response to an emergency situation at the Port Arthur Site.
3. All reimbursement will be based upon proper documentation, including invoices, accountings,
inventories,receipts,and other evidence of costs incurred by the Emergency Responder.
4. The Emergency Responder may waive all or any part of the payment for costs at its sole discretion
depending on the size of the mutual aid package and the length of the deployment.
Page 1 of 3
Port Arthur LNG
5. This Agreement shall continue in full force and effect until the date that falls 30 days after either
Party provides written notice of termination to the other Party. The expiration or termination of
this Agreement will not release either Party from any obligation or liability to the other Party that
has already accrued hereunder or otherwise survives the expiration or termination of this
Agreement.
6. This Agreement and the terms set forth herein are confidential and the Parties agree not to disclose
such terms other than as otherwise set forth in this Agreement and as required by applicable law or
any securities exchange; provided that each Party may disclose the terms hereof to each of their
and their respective affiliates' members,partners (and potential partners), equity holders,officers,
employees, agents, lenders(and potential lenders), suppliers, service providers and other advisors
that have a bona fide need to know such information and that have agreed to use this information
only for the purposes intended herein and to agree to keep such information confidential and to
potential assignees of all or part of a Party's rights and obligations hereunder and that have agreed
to use this information only for the purposes of evaluating such assignment and to agree to keep
such information confidential.The provisions of this Section 6 shall survive termination of this
Agreement until the date that is two years after such termination.
7. Neither Party may assign any of its rights hereunder without the prior written consent of the other
Party, which consent shall not be unreasonably withheld, conditioned, or delayed; provided that
PALNG may, with at least 15 days' advance written notice to the Emergency Responder, assign
this Agreement to any of its affiliates without the Emergency Responder's prior written consent.
8. This Agreement shall be governed by and construed in accordance with the laws of the State of
Texas without giving effect to any conflict of law principles that would result in the application of
the laws of another jurisdiction. Any legal suit,action,or proceeding arising out of this Agreement
shall be instituted in the federal courts of the United States of America or the courts of the State of
Texas in each case located in the Houston, Texas, and each Party irrevocably submits to the
exclusive jurisdiction of such courts in any such suit,action,or proceeding.
9. This Agreement is solely for the benefit of the Parties and their respective successors and permitted
assigns and is not to be deemed to confer upon or give to any person any remedy, claim, liability,
reimbursement,cause of action,or other right.
10. This Agreement constitutes the entire agreement between the Parties relating to the subject matter
and supersedes all other all prior correspondence, memoranda, agreements, representations, or
understandings, written or oral, between the Parties relating to the subject matter. No change,
modification, or addition to or waiver of any provision of this Agreement will be binding unless
made in writing and signed by duly authorized representatives of both Parties.
11. Anything that is not contained or expressly incorporated by reference in this Agreement, is not part
of this Agreement.
12. All notices, requests, consents, claims, demands, waivers, and other communications hereunder
(each, a"Notice") shall be in writing and addressed to the other Party at its address set out below
its signature(or to such other address that the receiving Party may designate from time to time in
accordance with this section). All Notices shall be delivered by personal delivery, nationally
recognized overnight courier(with all fees prepaid),email(with confirmation of transmission),or
certified or registered mail (in each case, return receipt requested, postage prepaid). Except as
otherwise provided in this Agreement, a Notice is effective only(a)upon receipt by the receiving
Party and(b)if the Party giving the Notice has complied with the requirements of this Section.
Page 2 of 3
Port Arthur LNG
13. This Agreement may be executed in any number of counterparts(including electronically)and each
such counterpart shall be deemed an original for all purposes; provided that neither Party shall be
bound to this Agreement unless and until both Parties have executed a counterpart.
IN WITNESS WHEREOF,the Parties have executed this Agreement effective as of the Effective Date.
PALNG OPERATOR COMPANY,LLC City of Port Arthur—Police Department
Signature Signature
Name: Chris Fortenberry Name: Ron Burton,CPM
Title: Vice President of Operations Title: City Manager
Port Arthur LNG,LLC
Address for Notices: Address for Notices:
PALNG Operator Company,LLC Ron Burton
1500 Post Oak Boulevard,Suite 1000 P.O.BOX 1089
Houston,TX 77056 Port Arthur,TX 77641-1089
Attention: HSE Manager,Port Arthur LNG Attention:Vivian Wilson
E-mail: croy@sempraglobal.com E-mail:Vivian.wilson@portarthurtx.gov
With a copy to:
Sempra Infrastructure Partners,LP
1500 Post Oak Boulevard, Suite 1000
Houston,TX 77056
Attn: Chief Legal Officer
Email: SIgeneralcounsel(a,SempraGlobal.com
Page 3 of 3