Preview of our top selling Turnkey Construction Contract
Cheniere Energy - Lump Sum Turnkey Agreement
LUMP SUM TURNKEY AGREEMENT
for the
ENGINEERING, PROCUREMENT AND CONSTRUCTION
of the
SABINE PASS LNG RECEIVING, STORAGE AND REGASIFICATION TERMINAL
by and between
SABINE PASS LNG, L.P.
as Owner
and
BECHTEL CORPORATION
as Contractor
Dated as of the 18 th Day of December, 2004
-30
TABLE OF CONTENTS
ntbl RECITALS
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 1
ntbl DEFINITIONS
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 2
ntbl RELATIONSHIP OF OWNER, CONTRACTOR AND SUBCONTRACTORS
ntbl
ntbl
ntbl 2.1
ntbl Status of Contractor
ntbl
ntbl
ntbl 2.2
ntbl Key Personnel, Organization Chart and Contractor Representative
ntbl
ntbl
ntbl 2.3
ntbl Subcontractors and Sub-subcontractors
ntbl
ntbl
ntbl 2.4
ntbl Subcontracts and Sub-subcontracts
ntbl
ntbl
ntbl 2.5
ntbl Contractor Acknowledgements
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 3
ntbl CONTRACTOR92S RESPONSIBILITIES
ntbl
ntbl
ntbl 3.1
ntbl Scope of Work
ntbl
ntbl
ntbl 3.2
ntbl Specific Obligations
ntbl
ntbl
ntbl 3.3
ntbl Design and Engineering Work
ntbl
ntbl
ntbl 3.4
ntbl Spare Parts
ntbl
ntbl
ntbl 3.5
ntbl Training Program in General
ntbl
ntbl
ntbl 3.6
ntbl Environmental Regulations and Environmental Compliance
ntbl
ntbl
ntbl 3.7
ntbl Construction Equipment
ntbl
ntbl
ntbl 3.8
ntbl Employment of Personnel
ntbl
ntbl
ntbl 3.9
ntbl Clean-Up
ntbl
ntbl
ntbl 3.10
ntbl HSE Plan; Security
ntbl
ntbl
ntbl 3.11
ntbl Emergencies
ntbl
ntbl
ntbl 3.12
ntbl Contractor Permits
ntbl
ntbl
ntbl 3.13
ntbl Books, Records and Audits
ntbl
ntbl
ntbl 3.14
ntbl Tax Accounting
ntbl
ntbl
ntbl 3.15
ntbl Temporary Utilities, Roads, Facilities and Storage
ntbl
ntbl
ntbl 3.16
ntbl Subordination of Liens
ntbl
ntbl
ntbl 3.17
ntbl Hazardous Materials
ntbl
ntbl
ntbl 3.18
ntbl Quality Assurance
ntbl
ntbl
ntbl 3.19
ntbl Reports
ntbl
ntbl
ntbl 3.20
ntbl Payment
ntbl
ntbl
ntbl 3.21
ntbl Commercial Activities
ntbl
ntbl
ntbl 3.22
ntbl Title to Materials Found
ntbl
ntbl
ntbl 3.23
ntbl Survey Control Points and Layout
ntbl
ntbl
ntbl 3.24
ntbl Cooperation with Others
ntbl
ntbl
ntbl 3.25
ntbl Responsibility for Property
ntbl
ntbl
ntbl 3.26
ntbl Explosives
ntbl
ntbl
ntbl 3.27
ntbl Taxes
ntbl
ntbl
ntbl 3.28
ntbl Equipment Quality
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 4
ntbl OWNER92S RESPONSIBILITIES
ntbl
ntbl
ntbl 4.1
ntbl Payment and Financing
ntbl
ntbl
ntbl 4.2
ntbl Owner Permits
ntbl
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ntbl
ntbl 4.3
ntbl Access to the Site and Off-Site Rights of Way and Easements
ntbl
ntbl
ntbl 4.4
ntbl Operation Personnel
ntbl
ntbl
ntbl 4.5
ntbl Sales and Use Tax Matters
ntbl
ntbl
ntbl 4.6
ntbl Legal Description and Survey
ntbl
ntbl
ntbl 4.7
ntbl Hazardous Materials
ntbl
ntbl
ntbl 4.8
ntbl Owner-Provided Items
ntbl
ntbl
ntbl 4.9
ntbl LNG Tanker Release
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 5
ntbl COMMENCEMENT OF WORK, PROJECT SCHEDULE, AND SCHEDULING OBLIGATIONS
ntbl
ntbl
ntbl 5.1
ntbl Commencement of Work
ntbl
ntbl
ntbl 5.2
ntbl Limited Notice to Proceed/Notice to Proceed
ntbl
ntbl
ntbl 5.3
ntbl Project Schedule
ntbl
ntbl
ntbl 5.4
ntbl CPM Schedule Submissions
ntbl
ntbl
ntbl 5.5
ntbl Recovery and Recovery Schedule
ntbl
ntbl
ntbl 5.6
ntbl Acceleration and Acceleration Schedule
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 6
ntbl CHANGES; FORCE MAJEURE; AND OWNER-CAUSED DELAY
ntbl
ntbl
ntbl 6.1
ntbl Change Orders Requested by Owner
ntbl
ntbl
ntbl 6.2
ntbl Change Orders Requested by Contractor
ntbl
ntbl
ntbl 6.3
ntbl Contract Price Adjustment; Contractor Documentation
ntbl
ntbl
ntbl 6.4
ntbl Change Orders Act as Accord and Satisfaction
ntbl
ntbl
ntbl 6.5
ntbl Timing Requirements for Notifications and Change Order Requests by Contractor
ntbl
ntbl
ntbl 6.6
ntbl Evidence of Funds
ntbl
ntbl
ntbl 6.7
ntbl Adjustment Only Through Change Order
ntbl
ntbl
ntbl 6.8
ntbl Force Majeure
ntbl
ntbl
ntbl 6.9
ntbl Extensions of Time and Adjustment of Compensation
ntbl
ntbl
ntbl 6.10
ntbl Delay
ntbl
ntbl
ntbl 6.11
ntbl Contractor Obligation to Mitigate Delay
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 7
ntbl CONTRACT PRICE AND PAYMENTS TO CONTRACTOR
ntbl
ntbl
ntbl 7.1
ntbl Contract Price
ntbl
ntbl
ntbl 7.2
ntbl Interim Payments
ntbl
ntbl
ntbl 7.3
ntbl Final Completion and Final Payment
ntbl
ntbl
ntbl 7.4
ntbl Payments Not Acceptance of Work
ntbl
ntbl
ntbl 7.5
ntbl Payments Withheld
ntbl
ntbl
ntbl 7.6
ntbl Interest on Late Payments and Improper Collection
ntbl
ntbl
ntbl 7.7
ntbl Offset
ntbl
ntbl
ntbl 7.8
ntbl Procedure for Withholding, Offset and Collection on the Letter of Credit
ntbl
ntbl
ntbl 7.9
ntbl Payment Error
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 8
ntbl TITLE AND RISK OF LOSS
ntbl
ntbl
ntbl 8.1
ntbl Title
ntbl
ntbl
ntbl 8.2
ntbl Risk of Loss
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 9
ntbl INSURANCE AND LETTER OF CREDIT
ntbl
ii
-30
ntbl
ntbl 9.1
ntbl Insurance
ntbl
ntbl
ntbl 9.2
ntbl Irrevocable Standby Letter of Credit
ntbl
ntbl
ntbl 9.3
ntbl Bechtel General Corporate Facts and Contractor Quarterly Confirmation
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 10
ntbl OWNERSHIP OF DOCUMENTATION
ntbl
ntbl
ntbl 10.1
ntbl Work Product, Contractor92s Intellectual Property and Third Party Proprietary Work Product
ntbl
ntbl
ntbl 10.2
ntbl Return/Delivery of Certain Property
ntbl
ntbl
ntbl 10.3
ntbl Contractor92s Right to Use of Work Product
ntbl
ntbl
ntbl 10.4
ntbl Owner Provided Documents
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 11
ntbl COMPLETION AND PERFORMANCE LIQUIDATED DAMAGES
ntbl
ntbl
ntbl 11.1
ntbl Notice of RFCD and Delivery of LNG for Commissioning, Start-Up and Performance Testing
ntbl
ntbl
ntbl 11.2
ntbl Delay in RFCD
ntbl
ntbl
ntbl 11.3
ntbl Notice and Requirements for Substantial Completion
ntbl
ntbl
ntbl 11.4
ntbl Owner Acceptance of RFCD and Substantial Completion
ntbl
ntbl
ntbl 11.5
ntbl Performance Liquidated Damages
ntbl
ntbl
ntbl 11.6
ntbl Punchlist
ntbl
ntbl
ntbl 11.7
ntbl Notice and Requirements for Final Completion
ntbl
ntbl
ntbl 11.8
ntbl Operations Activities
ntbl
ntbl
ntbl 11.9
ntbl Schedule Bonus
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 12
ntbl WARRANTY AND CORRECTION OF WORK
ntbl
ntbl
ntbl 12.1
ntbl Warranty
ntbl
ntbl
ntbl 12.2
ntbl Correction of Work Prior to Substantial Completion
ntbl
ntbl
ntbl 12.3
ntbl Correction of Work After Substantial Completion
ntbl
ntbl
ntbl 12.4
ntbl Assignability of Warranties
ntbl
ntbl
ntbl 12.5
ntbl Waiver of Implied Warranties
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 13
ntbl DELAY LIQUIDATED DAMAGES
ntbl
ntbl
ntbl 13.1
ntbl Delay Liquidated Damages
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 14
ntbl CONTRACTOR92S REPRESENTATIONS
ntbl
ntbl
ntbl 14.1
ntbl Corporate Standing
ntbl
ntbl
ntbl 14.2
ntbl No Violation of Law; Litigation
ntbl
ntbl
ntbl 14.3
ntbl Licenses
ntbl
ntbl
ntbl 14.4
ntbl No Breach
ntbl
ntbl
ntbl 14.5
ntbl Corporate Action
ntbl
ntbl
ntbl 14.6
ntbl Financial Solvency
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 15
ntbl OWNER92S REPRESENTATIONS
ntbl
ntbl
ntbl 15.1
ntbl Standing
ntbl
ntbl
ntbl 15.2
ntbl No Violation of Law; Litigation
ntbl
ntbl
ntbl 15.3
ntbl Licenses
ntbl
ntbl
ntbl 15.4
ntbl No Breach
ntbl
ntbl
ntbl 15.5
ntbl Corporate Action
ntbl
iii
-30
ntbl
ntbl 15.6
ntbl Financial Solvency
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 16
ntbl DEFAULT, TERMINATION AND SUSPENSION
ntbl
ntbl
ntbl 16.1
ntbl Default by Contractor
ntbl
ntbl
ntbl 16.2
ntbl Termination for Convenience by Owner
ntbl
ntbl
ntbl 16.3
ntbl Suspension of Work
ntbl
ntbl
ntbl 16.4
ntbl Suspension by Contractor
ntbl
ntbl
ntbl 16.5
ntbl Termination by Contractor
ntbl
ntbl
ntbl 16.6
ntbl Termination in the Event of Delayed Notice to Proceed
ntbl
ntbl
ntbl 16.7
ntbl Termination in the Event of an Extended Force Majeure
ntbl
ntbl
ntbl 16.8
ntbl Contractor92s Right to Terminate
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 17
ntbl INDEMNITIES
ntbl
ntbl
ntbl 17.1
ntbl General Indemnification
ntbl
ntbl
ntbl 17.2
ntbl Injuries to Contractor92s Employees and Damage to Contractor92s Property
ntbl
ntbl
ntbl 17.3
ntbl Injuries to Owner92s Employees and Damage to Owner92s Property
ntbl
ntbl
ntbl 17.4
ntbl Patent and Copyright Indemnification Procedure
ntbl
ntbl
ntbl 17.5
ntbl Lien Indemnification
ntbl
ntbl
ntbl 17.6
ntbl Owner92s Failure to Comply with Applicable Law
ntbl
ntbl
ntbl 17.7
ntbl Landowner Claims
ntbl
ntbl
ntbl 17.8
ntbl Legal Defense
ntbl
ntbl
ntbl 17.9
ntbl Enforceability
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 18
ntbl DISPUTE RESOLUTION
ntbl
ntbl
ntbl 18.1
ntbl Negotiation
ntbl
ntbl
ntbl 18.2
ntbl Arbitration
ntbl
ntbl
ntbl 18.3
ntbl Continuation of Work During Dispute
ntbl
ntbl
ntbl 18.4
ntbl Escrow of Certain Disputed Amounts By Owner
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 19
ntbl CONFIDENTIALITY
ntbl
ntbl
ntbl 19.1
ntbl Contractor92s Obligations
ntbl
ntbl
ntbl 19.2
ntbl Owner92s Obligations
ntbl
ntbl
ntbl 19.3
ntbl Definitions
ntbl
ntbl
ntbl 19.4
ntbl Exceptions
ntbl
ntbl
ntbl 19.5
ntbl Equitable Relief
ntbl
ntbl
ntbl 19.6
ntbl Term
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 20
ntbl LIMITATION OF LIABILITY
ntbl
ntbl
ntbl 20.1
ntbl Contractor Aggregate Liability
ntbl
ntbl
ntbl 20.2
ntbl Limitation on Contractor92s Liability for Liquidated Damages
ntbl
ntbl
ntbl 20.3
ntbl Liquidated Damages In General
ntbl
ntbl
ntbl 20.4
ntbl Consequential Damages
ntbl
ntbl
ntbl 20.5
ntbl Exclusive Remedies
ntbl
ntbl
ntbl 20.6
ntbl Applicability
ntbl
ntbl
ntbl 20.7
ntbl Term Limit
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ARTICLE 21
ntbl MISCELLANEOUS PROVISIONS
ntbl
iv
-30
ntbl
ntbl 21.1
ntbl Entire Agreement
ntbl
ntbl
ntbl 21.2
ntbl Amendments
ntbl
ntbl
ntbl 21.3
ntbl Joint Effort
ntbl
ntbl
ntbl 21.4
ntbl Captions
ntbl
ntbl
ntbl 21.5
ntbl Notice
ntbl
ntbl
ntbl 21.6
ntbl Severability
ntbl
ntbl
ntbl 21.7
ntbl Assignment
ntbl
ntbl
ntbl 21.8
ntbl No Waiver
ntbl
ntbl
ntbl 21.9
ntbl Governing Law
ntbl
ntbl
ntbl 21.10
ntbl Successors and Assigns
ntbl
ntbl
ntbl 21.11
ntbl Attachments and Schedules
ntbl
ntbl
ntbl 21.12
ntbl Obligations
ntbl
ntbl
ntbl 21.13
ntbl Further Assurances
ntbl
ntbl
ntbl 21.14
ntbl Priority
ntbl
ntbl
ntbl 21.15
ntbl Restrictions on Public Announcements
ntbl
ntbl
ntbl 21.16
ntbl Potential Lenders, Potential Equity Investors and Equity Participants
ntbl
ntbl
ntbl 21.17
ntbl Foreign Corrupt Practices Act
ntbl
ntbl
ntbl 21.18
ntbl Language
ntbl
ntbl
ntbl 21.19
ntbl Counterparts
ntbl
ntbl
ntbl 21.20
ntbl Federal Energy Regulatory Commission Approval
ntbl
ntbl
ntbl 21.21
ntbl Owner92s Lender
ntbl
ntbl
ntbl 21.22
ntbl Independent Engineer
ntbl
ntbl
ntbl 21.23
ntbl Survival
ntbl
v
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LIST OF ATTACHMENTS AND SCHEDULES
ntbl ATTACHMENT A
ntbl Scope of Work and Design Basis
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE A-1
ntbl-200 Scope of Work
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE A-2
ntbl-200 Design Basis
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE A-3
ntbl-200 Conceptual Engineering Documents and Trends List
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT B
ntbl Contractor Deliverables
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT C
ntbl Payment Schedule
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE C-1
ntbl-200 Milestone Payment Schedule
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE C-2
ntbl-200 Monthly Payment Schedule
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT D
ntbl Form of Change Order
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE D-1
ntbl-200 Change Order Form
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE D-2
ntbl-200 Unilateral Change Order Form
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE D-3
ntbl Contractor92s Change Order Request Form/Contractor92s Response to a Change Order Proposed by Owner
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE D-4
ntbl-200 Unit Rates for Change Orders Performed on a Time and Materials Basis
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT E
ntbl Project Schedule
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT F
ntbl Key Personnel and Contractor92s Organization
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT G
ntbl Approved Subcontractors and Sub-subcontractors and List of Major Equipment
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT H
ntbl Form of Limited Notice to Proceed and Notice to Proceed
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE H-1
ntbl-200 Form of Limited Notice to Proceed
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE H-2
ntbl-200 Form of Notice to Proceed
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT I
ntbl Form of Contractor92s Invoices
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE I-1
ntbl-200 Form of Contractor92s Interim Invoice
vi
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ntbl
ntbl SCHEDULE I-2
ntbl-200 Form of Contractor92s Final Invoice
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT J
ntbl HSE Plan Requirements
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT K
ntbl Form of Lien and Claim Waivers
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE K-1
ntbl-200 Contractor92s Interim Conditional Lien Waiver
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE K-2
ntbl-200 Contractor92s Interim Unconditional Lien Waiver
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE K-3
ntbl-200 Subcontractor92s Interim Conditional Lien Waiver
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE K-4
ntbl-200 Subcontractor92s Interim Unconditional Lien Waiver
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE K-5
ntbl-200 Contractor92s Final Conditional Lien and Claim Waiver
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE K-6
ntbl-200 Contractor92s Final Unconditional Lien and Claim Waiver
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE K-7
ntbl-200 Subcontractor92s Final Conditional Lien and Claim Waiver
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE K-8
ntbl-200 Subcontractor92s Final Unconditional Lien and Claim Waiver
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT L
ntbl Form of RFCD Completion Certificate
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT M
ntbl Form of Substantial Completion Certificate
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT N
ntbl Form of Final Completion Certificate
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT O
ntbl Insurance Requirements
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT P
ntbl Contractor Permits
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT Q
ntbl Owner Permits
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT R
ntbl Form of Irrevocable, Standby Letters of Credit
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE R-1
ntbl-200 Form of Performance Letter of Credit
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE R-2
ntbl-200 Form of Payment Letter of Credit
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT S
ntbl Performance Tests
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT T
ntbl Performance Guarantees, Performance Liquidated Damages, Minimum Acceptance Criteria and Delay Liquidated Damages
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT U
ntbl Owner-Provided Items and Responsibility
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT V
ntbl Pre-Commissioning, Commissioning, Start-Up and Training
ntbl
vii
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ntbl ATTACHMENT W
ntbl Operating Spare Parts List
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT X
ntbl [Not Used.]
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT Y
ntbl Site and Off-Site Rights of Way and Easements
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT Z
ntbl [Not Used.]
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT AA
ntbl Form of Acknowledgement and Consent Agreement with Lender
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT BB
ntbl Form of Contractor and Owner Confirmations
ntbl
ntbl
ntbl
ntbl
ntbl
ntbl SCHEDULE BB-1
ntbl-200 Form of Contractor Quarterly Confirmation
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE BB-2
ntbl-200 Form of Owner Monthly Confirmation
ntbl
ntbl
ntbl-200
ntbl
ntbl SCHEDULE BB-3
ntbl-200 Form of Owner Quarterly Confirmation
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT CC
ntbl Independent Engineer Activities
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT DD
ntbl Form of Escrow Agreement
ntbl
ntbl
ntbl
ntbl
ntbl ATTACHMENT EE
ntbl Stainless Steel Adjustment, Tank Subcontract Materials Adjustment, Marine Loading Arm Adjustment and BOG Compressor Adjustment
ntbl
viii
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SABINE PASS LNG RECEIVING,
STORAGE AND REGASIFICATION TERMINAL
ENGINEERING, PROCUREMENT AND CONSTRUCTION AGREEMENT
THIS ENGINEERING, PROCUREMENT AND CONSTRUCTION AGREEMENT (this " Agreement "), dated as of the 18 th Day of December,
2004 (the " Contract Date "), is entered into by and between SABINE PASS LNG, L.P. , a Delaware limited partnership, having its principal place of business at 717 Texas Avenue, Suite
3100, Houston, Texas 77002 (" Owner "), and BECHTEL CORPORATION , a Nevada corporation, having an address at 3000 Post Oak Boulevard, Houston, Texas 77056 ("
Contractor " and, together with Owner, each a " Party " and together the " Parties ").
RECITALS
WHEREAS, Owner desires to enter into an agreement with Contractor to provide services for the engineering, procurement and construction of a turnkey LNG receiving, storage and regasification terminal to be owned by Owner,
located near the town of Johnson92s Bayou in Cameron Parish, Louisiana, and all related appurtenances thereto (as more fully described below, the " Facility " or
" Project "), and to commission, start-up and test the Facility, all as further described herein; and
WHEREAS, Contractor, itself or through its vendors, suppliers, and subcontractors, desires to provide the foregoing engineering, procurement, construction, commissioning, start-up and testing services on a turnkey lump sum basis;
NOW THEREFORE, in consideration of the mutual covenants herein contained and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows:
Article 1
DEFINITIONS
1.1 In addition to other defined terms used throughout this Agreement, when used herein, the following capitalized terms have the meanings specified
in this Section 1.1.
" AAA " has the meaning set forth in Section 18.2.
" AAA Rules " has the meaning set forth in Section 18.2.
" Acceleration Schedule " has the meaning set forth in Section 5.6A.
" Actual Insurance Cost " has the meaning set forth in Section 7.1B.
" Administrative Agent " means the administrative agent under the credit agreement for the financing of the Project.
" Advance Payment " has the meaning set forth in Section 7.2A.
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" Affiliate " means any Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with a Party.
For purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction
of the management and policies of a Person, whether through the ownership of voting securities or otherwise.
" Agreement " means this Agreement for the performance of the Work (including all Attachments and Schedules attached hereto), as it may be amended from time to time
in accordance with this Agreement.
" Applicable Codes and Standards " means any and all codes, standards or requirements applicable to the Work set forth or listed in Attachment A , in any Applicable Law (subject
to an adjustment by Change Order in accordance with Section 6.2A.1), or which are set forth or listed in any document or Drawing listed in Attachment A , which codes, standards and requirements shall govern Contractor92s performance
of the Work, as provided herein, provided that , with respect to Applicable Codes and Standards which are not set forth in any Applicable Law, any reference herein to Applicable Codes and Standards shall be deemed only to refer to such
Applicable Codes and Standards in existence as of the Contract Date.
" Applicable Law " means all laws, statutes, ordinances, orders, decrees, injunctions, licenses, Permits, approvals, rules and regulations, including any conditions thereto, of any Governmental
Instrumentality having jurisdiction over all or any portion of the Site or the Facility or performance of all or any portion of the Work or the operation of the Facility, or other legislative or administrative action of a Governmental Instrumentality,
or a final decree, judgment or order of a court which relates to the performance of Work hereunder.
" Bechtel General Corporate Facts " has the meaning set forth in Section 9.3.
" BOG Compressor Adjustment " has the meaning set forth in Section 7.1G.
" Boil-Off " means Natural Gas which comes out of a liquid phase into a gas phase in various locations within the Facility (except Natural Gas produced by the vaporizers), and is collected
in the boil-off or vapor handling system.
" Books and Records " has the meaning set forth in Section 3.13A.
" Business Day " means every Day other than a Saturday, a Sunday or a Day that is an official holiday for employees of the federal government of the United States of America.
" CAD " has the meaning set forth in Section 3.3E.
" Change Order " means, after the execution of this Agreement, any of the following: (i) a written order issued by Owner to Contractor, in the form of Schedule D-2 , (ii)
a written instrument signed by both Parties in the form of Schedule D-1 , in each case executed pursuant to the applicable provisions of Article 6, or (iii) a determination issued pursuant to Article 18, that authorizes an addition to,
deletion from, suspension of, or any other
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modification or adjustment to the requirements of this Agreement, including the Work or any Changed Criteria.
" Changed Criteria " has the meaning set forth in Section 6.1A.
" Changes in Law " means any amendment, modification, superseding act, deletion, addition or change in or to Applicable Law (excluding changes to tax laws where such taxes are based upon Contractor92s
income or profits/losses) that occurs and takes effect after the Contract Date. A Change in Law shall include any official change in the interpretation or application of Applicable Law (including Applicable Codes and Standards set forth in Applicable
Law), provided that such change is expressed in writing by the applicable Governmental Instrumentality.
" Cheniere " means Cheniere Energy, Inc.
" Collateral Agent " means the collateral agent under the credit agreement for the financing of the Project.
" Confidential Information " has the meaning set forth in Section 19.3.
" Confirmed Acceleration Directive " has the meaning set forth in Section 5.6A.
" Consequential Damages " has the meaning set forth in Section 20.4.
" Construction Equipment " means the equipment, machinery, structures, scaffolding, materials, tools, supplies and systems owned, rented or leased by Contractor or its Subcontractors or Sub-subcontractors
for use in accomplishing the Work, but not intended for incorporation into the Facility.
" Construction Equipment Lessor " means the Subcontractor or Sub-subcontractor, as the case may be, who rents or leases Construction Equipment.
" Contract Date " has the meaning set forth in the preamble.
" Contract Price " has the meaning set forth in Section 7.1, as may be adjusted by Change Order in accordance with the terms of this Agreement.
" Contractor " has the meaning set forth in the preamble hereto.
" Contractor Group " means (i) Contractor and its Affiliates and (ii) the respective directors, officers, agents, employees, representatives of each Person specified in clause (i) above.
" Contractor Permits " means the Permits listed in Attachment P and any other Permits (not listed in either Attachment P or Attachment Q
) necessary for performance of the Work which are required to be obtained in Contractor92s name pursuant to Applicable Law.
" Contractor Quarterly Confirmation " has the meaning set forth in Section 9.3.
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" Contractor Representative " means that Person or Persons designated by Contractor in a written notice to Owner specifying any and all limitations of such Person92s
authority, and acceptable to Owner, who shall have complete authority to act on behalf of Contractor on all matters pertaining to this Agreement or the Work including giving instructions and making changes in the Work. The Contractor Representative
as of the Contract Date is designated in Section 2.2B.
" Contractor92s Confidential Information " has the meaning set forth in Section 19.2.
" Contractor92s Intellectual Property " has the meaning set forth in Section 10.1A.
" Cool Down " means the controlled process by which a process system is taken from its ambient condition (purged and cleaned of air, moisture and debris, etc.) and cooled down to its cryogenic
temperature (at or below - 260b0F) through the use of LNG, which shall be set forth in the Project Commissioning Plan. A system has achieved "Cool Down" when it has reached its cryogenic temperature in a stable condition.
" Corrective Work " has the meaning set forth in Section 12.3.
" CPM Schedule " has the meaning set forth in Section 5.4.
" Day " means a calendar day.
" Default " has the meaning set forth in Section 16.1A.
" Defect " or " Defective " has the meaning set forth in Section 12.1A.
" Defect Correction Period " means the period commencing upon Substantial Completion and ending eighteen (18) months thereafter.
" Delay Liquidated Damages " has the meaning set forth in Section 13.1C.
" Design Basis " means the basis of design and technical limits and parameters of the Facility as set forth in Schedule A-2 .
" Disclosing Party " has the meaning set forth in Section 19.3.
" Dispute " has the meaning set forth in Section 18.1.
" Dispute Notice " has the meaning set forth in Section 18.1.
" Drawings " means the graphic and pictorial documents showing the design, location and dimensions of the Facility, generally including plans, elevations, sections, details, schedules and
diagrams, which are prepared as a part of and during the performance of the Work.
" Effective Date " means the date on which Owner issues the Limited Notice to Proceed in accordance with Section 5.2A.
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" Equipment " means all equipment, materials, supplies, software, licenses and systems required for the completion of and incorporation into the Facility.
" Escrow Agent " means the escrow agent under the Escrow Agreement.
" Escrow Agreement " means the escrow agreement between Owner, Escrow Agent and Contractor, which shall be in the form attached hereto as Attachment DD .
" Escrowed Amounts " has the meaning set forth in Section 18.4.
" Excessive Monthly Precipitation " means that the total precipitation measured at the Site for the Month that the event in question occurred has exceeded the following selected probability
levels for such Month for Weather Station 417174 BPT, Port Arthur AP Beaumont TX, as specified in the National Oceanic and Atmospheric Administration publication titled "Climatography of the U.S. No. 81, Supplement No. 1, Monthly Precipitation Probabilities
and Quintiles, 1971-2000.":
-720 (1) For the period from Contractor92s mobilization to the Site until completion of the last Tank pile cap, the selected probability
level of 0.6 shall apply; and
(2) For all other periods after Contractor92s mobilization to the Site, the selected probability level of 0.8 shall apply.
The Parties recognize that the assessment as to whether or not total precipitation measured at the Site for ...
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