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Home My WebLink About04101 ORD - 01/31/1955IMS:AC:1 /31/55 AN ORDINANCE AUTHORIZING AND DIRECTING THE CITY MANAGER TO EXECUTE FOR AND ON BEHALF OF THE CITY AN AGREEMENT WITH TRUNK LINE- GAS COMPANY AND A. W. GREGG RATIFYING A GAS PURCHASE AGREEMENT BETWEEN A. W. GREGG AND TRUNKLINE GAS COMPANY AND AGREEING TO CALCULATE GAS PRODUCTION ON THE BASIS OF SWORN MONTHLY REPORTS TO THE RAILROAD COMMISSION, BUT RESERVING IN THE CITY SUCH RIGHTS AS MAY BE DETERMINED IN THE SUIT NOW PENDING CONCERNING OIL AND GAS LEASES WITH A. W. GREGG; AND DECLARING AN EMERGENCY. WHEREAS, TRUNKLINE GAS COMPANY IS PURCHASING GAS PRODUCED ON THE LAND OWNED BY THE CITY, WHICH IS A PART OF THE WATER WORKS SYSTEM RESERVOIR SITE,AND PRODUCTION IS BEING HAD FROM TWO LEASES DESIGNATED AS "A" AND LEASES RESPECTIVELY; AND WHEREAS, IT IS CONVENIENT TO CALCULATE THE PAYMENTS FROM SAID TWO LEASES ON THE BASIS OF FORM REPORTS TO THE RAILROAD COMMISSION; AND WHEREAS, A FIXED PRICE FOR GAS HAS BEEN AGREED UPON BETWEEN A. W. GREGG AND TRUNKLINE GAS COMPANY FOR THE PURCHASE OF SAID GAS, AND THE RAID PRICE IS AGREEABLE TO THE CITY OF CORPUS CHRISTI; AND WHEREAS, THE INTEREST OTHER -THAN THE ROYALTY PROVIDED FOR IN CERTAIN LEASES IS INVOLVED IN A SUIT FOR THE DETERMINATION OF THE VALIDITY OF SAID LEASES AND THE CONTINGENCY OF THE CITY ENLARGING ITS INTEREST AS A RESULT OF SAID LITIGATION IS RESERVED IN SAID AGREEMENT: NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. THAT THE CITY MANAGER FOR AND ON BEHALF OF THE CITY OF CORPUS CHRISTI, BE AND HE IS HEREBY AUTHORIZED AND DIRECTED TO EXECUTE THE AGREEMENTS MENTIONED ABOVE, COPIES OF WHICH ARE ATTACHED HERETO AND MADE A PART HEREOF, AND DESIGNATED AS "EXHIBIT 1" AND "EXHIBIT 2 ". SECTION 2. THE NECESSITY FOR OBTAINING REVENUE FROM THE PRODUCTION OF GAS FROM THE CITY OWNED LANDS CREATES A PUBLIC EMERGENCY AND AN IMPERATIVE PUBLIC NECESSITY REQUIRING THE SUSPENSION OF THE CHARTER RULE PROVIDING THAT NO ORDINANCE OR RESOLUTION SHALL BE PASSED FINALLY ON THE DATE OF ITS INTRODUCTION AND THAT SUCH ORDINANCE OR RESOLUTION SHALL BE READ AT THREE SEVERAL MEETI14GS OF THE CITY COUNCIL, -AND THE MAYOR, HAVING DECLARED SUCH EMERGENCY AND NECESSITY TO EXIST, HAVING REQUESTED THE SUSPENSION OF SAID CHARTER RULE AND THAT THIS I ORDINANCE BE PASSED FINALLY ON THE DATE OF ITS INTRODUCTION AND THAT SUCH .�T' ORDINANCE TAKE EFFECT AND BE IN FULL FORCE AND EFFECT FROM AND AFTER ITS PAS E, IT IS ACCORDINGLY PASSED AND APPROVED, THIS THE / DAY OF Gfiv.. 1955. MAYOR THE CITY OF CORPUS CHRISTI, ERAS ITY SECRE AR ' v� PP OVED AS TO LEGAL FORM: ITY ATTORNEY fi .}P STATE OF TEXAS COUNTIES OF JIM WELLS j RATIFICATION OF GAS PIMCHASE AND SAN PATRICIO ( AGREEMENT KNOW ALL MEN BY THESE PRESENTS THATS WHEREAS, an the 2nd fty of November, 1951, A. W. Gregg entered into a certain gas purchase agresmest with Trunklins Gas Company. a Delaware corporation, having a permit to do business in the Stater of Twms, fox the sale by A. W. Gregg and the purchase by Trunklino Gas Company, hereinafter called "Trunkline ", of certain quantities of gas produced by the said A. W. Gregg from lands listed in Exhibit "An of that contract Its having been leased by the City of Corpus Christi. Texasi and WHEREAS. on the day of 1952, the City of Corpus Christi, Tex" filed in the District Court of County. Texas against the said A. W. Gregg a suit for can o"ation of certain of the ail and gas leases doscsib6d in the said contract. which said suit is still parading between the said partiest and WHEREAS. A. W. Gregg and Trunkiiao hive* subject to the said litigation, renegotiated the above- mandowd contract in the form thereof attached hereto and made 'a part hereof, and in so doing provided. among other things. for an increase in the bass price per Mc€ for gas delivered thereunder; and WHEREAS, the City of Corpus Christi desires. in order A 1 11 that Tronkline wild make payments of royalties to the City for gas produced from property owned by the City and subject to the said contracts WW litigation, to ratify the said renegods d contract. NOW THEREFORE: WITNESSETH In consideration of the promises and of ct* Do11es ($1.00) and other valuable consideration to it in hand paid by Trunkltae Gas Company. receipt of which is hereby acknowledged by the City of Corpus Christi, the City of Corpoe Christi, actibg by and through its City Manager and upon due authorisation to so act given by its City Council, does hereby and herewith ratify, acknowledge and con- firxn in oil respects the form of contract attached hereto and made a part hereof, just as though the City were a party thereto. This ratification is subject in all respects, however, to the above - described litigation by and between the City d Corpus Christi and A. W. Gregg, and is not intended nor shall it be con- strued as affecting that litigation in any manner, but it is understood that in the event the City is successful therein by final judgment to that effect, the City of Corpus Christi shall thereupon forthwith be- come a party Seller thereunder, subject to all the tsrnas thereof just as though it had originally bean named therein a. such. Executed this day of . 1955. CITY OF CORPUS CHRISTI. TEXAS ATTEST: By City Secretary City gsr Trunkline Gas Company Post Office Box 1$42 Houston, Texas Gentlemen: There is herewith and hereby furnished you the mutual consent and agreement of the City of Corpus Christi. Texas, by its City Manager upon due authorization by its City Council, and A. W. Gregg that in order that Trunulne Gas Company' may make Payments of royalty to the said City for gas purchased by Trunkline Gas Company from properties operated by A. W. Gregg under leases to him from the City of Corpus Christi, which leases are subject to the litigation hereinafter mentioned; and especially in order that Trunkline may ascertain what royalty payments to the said City should be made in relation to gas produced from what is known as the "P" Lease, Trunkline Gas Company may accept and use the sworn monthly statements or reports to the Railroad Commission of Texas prepared and made by A. W. Gregg, copies of which are. pursuant hereto, to be provided to Truakline Gas Company by A. W. Gregg. It is understood that this arrangement shall apply to all royalty payments now suspended and hereafter made insofar as the same involve any production from the said 11P11 Lease. It is further understood and agreed that this agreement between the City of Corpus Christi and A. W. Gregg is entirely subject to the suit relating to certain oil and gas leases which are subject to that certain gas purchase contract between A. W. Gregg and Trunkline Gas Company dated November 2. 1951, which litigation is now pending and not finally determined, and nothing herein con- tained shall intend nor stall be used in any way by either party hereto in connection with that litigation or its final outcome. By acceptance and compliance herewith Trunkiine Gas Company shall not be considered as having waived any rights which it previously held, nor assumed any obligations or liabilities which itdtd not previously have. This letter is executed in three counterparts, all of which shall be considered originals. CITY OR CORPUS CHRISTI, TEXAS �A By City Manager A. W. Gregg �r so CORP HRISTI, TEXAS 1955 TO THE MEWERS-OF THE CITY COUNCIL CORPUS CHRISTI, TEXAS GENTLEMEN: FOR THE REASONS SET'FORTH IN THE EMERGENCY CLAUSE OF THE FOREGOING - ORDINANCE, A PUBLIC EMERGENCY AND IMPERATIVE NECESSITY EXIST FOR THE SUSPEN- SION OF THE CHARTER RULE OR REQUIREMENT THAT NO ORDINANCE OR RESOLUTION SHALL BE PASSED FINALLY ON THE DATE IT IS INTRODUCED, AND THAT SUCH ORDINANCE OR RESOLUTION SHALL BE READ AT THREE MEETINGS OF THE CITY COUNCIL; 1, THEREFORE, HEREBY REQUEST THAT YOU SUSPEND SAID-CHARTER RULE OR REQUIREMENT AND PASS THIS ORDINANCE FINALLY ON THE DATE IT IS INTRODUCED, OR AT-THE PRESENT MEETING OF THE CITY COUNCIL. RESPECTFULLY, A CITY OF CORPUS CHRISTI, TEXAS' THE CHARTER RULE WAS SUSPENDED BY THE FOLLOWING VOTED P. C. CALLAWAY Q ELLROY KING JAMES S. NAISMITH W. JAMES BRACE F. P. PETERSON, JR. THE ABOVE ORDINANCE WAS PASSED BY THE FOLLOWING VOTE: P. C. CALLAWAY ELLROY KING JAMES S. NAISMITH W. JAMES BRACE F. P. PETERSON, JR, q lc�l 1. i (3) BUYER SHALL PAY SELLERS THE SUM OF ONE- QUARTER CENT PER ONE THOUSAND (1000) CUBIC FEET, IN ADDITION TO THE PRICES SET OUT IN ARTICLE IX, FOR DEHYDRATING GAS DELIVERED HERE- UNDER AND SUCH GAS SHALL CONTAIN NOT T,0 EXCEED SIX (6) POUNDS OF WATER VAPOR PER MILLION CUBIC FEET. (4), BUYER SHALL HAVE THE RIGHT TO REJECT ANY GAS TEN- DERED TO IT BY SELLER FOR DELIVERY UNDER THIS CONTRACT WHICH DOES NOT MEET THE SPECIFICATIONS SET FORTH IN THIS ARTICLE. ARTICLE IX PRICE (1) BUYER AGREES TO PAY TO SELLER FOR EACH ONE THOU- SAND (1000) CUBIC FEET OF GAS SOLD AND DELIVERED BY SELLER TO BUYER HEREUNDER AS FOLLOWS; (A) FOR ALL GAS DELIVERED FROM .JANUARY 1, 1955 TO .JANUARY 1, 1960, 12 CENTS. (B) EFFECTIVE .JANUARY 1, 1960 AND UNTIL .JANUARY 1, 1965, THE PRICE SHALL BE NOT LESS THAN 13 CENTS. (C) EFFECTIVE .JANUARY 1, 1965 AND UNTIL .JANUARY 1, 1970, THE PRICE SHALL BE NOT 'LESS THAN 14 CENTS. (D) EFFECTIVE JANUARY 1, 1970 AND FOR THE REMAIN- ING TERM OF THIS CONTRACT, THE PRICE SHALL BE NOT LESS THAN 15 CENTS. -16-