HomeMy WebLinkAboutC2023-028 - 3/7/2023 - NA Limited Binding Memorandum of Understanding to Exclusively
Negotiate Groundwater Supply Agreement with
Evangeline Groundwater
This Limited Binding Memorandum of Understanding ("MOU") is entered into effective on the
7 day of March 2023 by and between:
Evangeline/Laguna LP ("Evangeline"), a limited partnership duly organized and existing
under the laws of the State of Texas, with its offices located at 5111 Broadway, San
Antonio,Texas 78209 and
The City of Corpus Christi ("Corpus Christi"), a public, home-rule municipality existing
under the laws of the State of Texas,with its city hall located at 1201 Leopard Street, Corpus
Christi Texas 78469-9277.
Evangeline and Corpus Christi will hereinafter individually be referred to as a "Party" and
collectively as the "Parties". The objective of this MOU is to serve as the basis on which the
Parties will evaluate the feasibility of the Project (as defined herein) and potentially negotiate
and enter into Definitive Agreements (as defined herein) for the delivery of groundwater to
Corpus Christi. The Parties' obligations regarding the Project are subject to mutual satisfactory
completion of further due diligence by the Parties and the successful negotiation and execution
of binding definitive agreements ("Definitive Agreements").
Section 1
Purpose
The purpose of the Project is to provide additional water supplies to meet the water demand
increases associated with anticipated near term growth in Corpus Christi. The "Project" consists
of the production and delivery of up to 25.4 million gallons of water per day ("MGD") (the
"Project Water") from the Evangeline Project site located in San Patricio County immediately
north of the City of Sinton as shown on the attached Exhibit A (the "Project Site") to a delivery
location specified by Corpus Christi (the "Delivery Point").
This MOU identifies key elements of the Project which the Parties will analyze and discuss in good
faith with a goal of negotiating and entering into the Definitive Agreements.
SCANNED
Mutual Understanding
Each Party hereby acknowledges and agrees as follows:
1. Corpus Christi is the regional water provider for the Coastal Bend,which plans, produces,
and distributes water for 500,000 residents in seven counties.
2. Corpus Christi is interested in obtaining an additional water supply to meet growing
demand and avoid potential water service curtailments;
3. Evangeline has obtained a permit from the San Patricio Groundwater Conservation
District to produce and supply 28,486 acre- feet per year of groundwater (25.4 MGD
equivalent)from the Project Site.
4. Evangeline has engaged Pape-Dawson Engineers Inc. and Corpus Christi has engaged
HDR Engineering, Inc. as engineers and consultants to work to assist the Parties with
their respective analyses of the Project.
s. Evangeline will negotiate exclusively with Corpus Christi for the term of this MOU.
This MOU facilitates the discussion among the Parties to determine the following key
commercial terms for the Project (the "Key Commercial Terms"):
a. The amount of Project Water to be delivered
b. Whether Project Water is to be delivered as"raw" (without treatment) or treated
(and the specifications for any treatment)
c. The Party that will build and own the infrastructure required to produce, treat, if
necessary and deliver the Project Water
d. Project financing
e. The resulting cost (after the factors above are decided upon) for delivered
Project Water
f. A project schedule and delivery date
g. Term of purchase agreement
h. Payment terms and delivery obligations
Based on resolution of the above, the Definitive Agreements, if approved, may include a long-
term groundwater supply and delivery agreement.
Term
The term of this MOU will be for an initial period of 90 days unless extended by mutual agreement
by the Parties.
Section 2: Non-binding Nature of MOU
Except as provided in this Section 2 and as specifically provided in Section 3, nothing contained
in this MOU shall create any legally binding obligations on the Parties, it being understood and
agreed that no such binding obligations shall exist with respect to the Project unless and until the
Definitive Agreements have been executed by the Parties. Neither of the Parties nor any of their
respective owners, officers or affiliates shall be bound, obligated or liable, directly or indirectly,
as a result of any discussions, correspondence, or course of conduct (including reliance and
changes of positions), and each of the Parties hereby reserves unrestricted discretion in
negotiating the Definitive Agreements. The Parties agree that the terms mentioned herein
impose no burden or obligation to negotiate further terms, until the Definitive Agreements have
been finalized and executed. Any Party hereto may also unilaterally terminate all negotiations.
The Parties acknowledge and agree that the Key Commercial Terms set forth in Section 1 above
include only a preliminary summary of the discussions between the Parties to date, may omit
some material terms, are based on certain material conditions and are solely meant to express
the intent of the Parties and their basic understandings of the Project so that further negotiations
may take place.
Section 3: Binding Terms. The following binding terms shall govern the Parties relationship
under this MOU and the interpretation of this MOU:
Costs. Each Party will be expected to fund any costs incurred by that Party in connection with
this MOU.
Governing Law. This MOU shall be governed and construed in accordance with the law of the
State of Texas, without regard to the conflicts of law principles thereof.
Amendment. Any amendment to,or extension of,this MOU shall be in writing and agreed to and
signed by all Parties.
Entire Agreement. This MOU constitutes the whole agreement and understanding between the
Parties with respect to the subject matter of this MOU and supersedes in its entirety any and all
previous understandings, agreements, and communications between the Parties in relation to
the same.
Counterparts; Authority. This MOU may be executed in one or more counterparts. Each Party
represents that it is duly authorized to execute this MOU and perform its obligations hereunder.
IN WITNESS WHEREOF, the Parties hereto have caused this MOU to be executed by their
respective duly authorized representatives effective as of the day and year first above written.
EVANGELINE/LAGUNA, LP CITY OF CORPUS CHRISTI
By its general partner,
Evangeline/Laguna GP, LLC
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By: By:
Name: Edward A. Cross II Name: eter Zanoni
Title: Manager Title: City Manager
Exhibit A
Project Location
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