CRUDE OIL TRANSPORTATION AGREEMENT
Exhibit 10.8
CRUDE OIL TRANSPORTATION AGREEMENT
The following shall constitute an agreement by and between Banner Pipeline Company, LLC, a wholly owned subsidiary of Continental Resources, Inc. (CLR herein) and Banner Transportation Company LLC (Banner herein) whereby CLR agrees to utilize the transportation, gathering, and other services provided by Banner as set forth below:
WHEREAS Banner owns and operates a pipeline gathering and transportation system generally located in Townships 22-25N, and Ranges 52-57E, in Richland County, Montana (the “Gathering System”); and
WHEREAS CLR desires (i) to deliver into and transport crude oil through the Gathering System and (ii) to deliver via non-pipeline methods and unload crude oil at Banner’s ▇▇▇▇▇ Station located in Section 25-T24N-R56E, Richland County, Montana (“▇▇▇▇▇ Station”) and (iii) to deliver via non-pipeline methods and unload crude oil at Banner’s ▇▇▇▇▇ Station located in Section 3–T24N-R54E, Richland County, Montana (“▇▇▇▇▇ Station”); and
WHEREAS Banner wishes to provide the requested crude oil transportation, gathering, and other services over its system and at its ▇▇▇▇▇ Station and ▇▇▇▇▇ Station and to provide these services under the following terms and conditions:
NOW THEREFORE, IN CONSIDERATION OF the mutual covenants and agreements herein contained, the parties agree as follows
A. PIPELINE TRANSPORTATION:
| SERVICE: |
Banner shall connect onto its Gathering System and accept delivery of crude oil at mutually acceptable connection points for each lease, well or facility identified on Exhibit “A” attached hereto and incorporated herein by reference. All such crude oil shall be transported in the Gathering System pursuant to CLR instructions at either a delivery point at Banner’s ▇▇▇▇▇ Station and delivered into Plains Pipeline L.P. facilities at Lone Tree, Montana or a delivery point at Banner’s ▇▇▇▇▇ Station and delivered into Bridger Pipeline Company’s pipeline for the account of CLR. |
| QUANTITY: | Crude oil volumes made subject to this agreement for gathering and transportation include but are not limited to production from the list of leases, ▇▇▇▇▇ and properties attached hereto as Exhibit “A”. |
| PRICE: | CLR shall pay to Banner an amount equal to $1.04/barrel for crude oil delivered to CLR’s account at ▇▇▇▇▇ Station and delivered into Plains Pipeline L.P. facilities at Lone Tree, Montana or delivered into Bridger Pipeline Company’s facilities at ▇▇▇▇▇ Station. Payment by CLR shall be made in response to detailed invoices from Banner which may be sent no more frequently than once per month. |
| LINE LOSS: | The price agreed to be paid above includes compensation for any and all line loss that may be experienced in the gathering or transporting of the crude oil contemplated herein. In no event will additional charges be made to CLR to compensate Banner for line loss regardless of how described or classified. |
| LINE FILL: | CLR agrees to provide its pro rata share of barrels of crude oil for line fill required for operation of the Gathering System. Such line fill may be withdrawn from the Gathering System within (30) days after termination of this agreement. |
B. NON-PIPELINE/TRUCKED TRANSPORTATION:
| SERVICE: | Banner hereby agrees to unload and accept into its facilities at its ▇▇▇▇▇ Station or ▇▇▇▇▇ Station as designated by CLR for CLR’s account crude oil from the leases, ▇▇▇▇▇ or facilities identified or listed on Exhibit “B” attached hereto and incorporated herein by reference. It is anticipated that all such crude oil shall be transported by means other than through the Gathering System to either ▇▇▇▇▇ Station or ▇▇▇▇▇ Station. |
| QUANTITY: | Crude oil volumes made subject to this agreement for non-pipeline delivered crude oil include but are not limited to production from the list of leases, ▇▇▇▇▇ and properties attached hereto as Exhibit “B”. |
| PRICE: | CLR shall pay to Banner an amount equal to $0.10/barrel of crude oil delivered for its account to ▇▇▇▇▇ Station or ▇▇▇▇▇ Station by non-pipeline means. Payment by CLR shall be made in response to detailed invoices from Banner which may be sent no more frequently than once per month. |
C. ADDITIONAL PROVISIONS:
| TERM: | The term of this Agreement (the “Term”) shall commence on July 1, 2007, and shall continue month to month until terminated. This Agreement is terminable by either party upon thirty (30) days written notice delivered pursuant to the contact information provided below. |
| INDEMNITIES: | Banner shall be liable to and indemnify, defend and hold CLR, its affiliates and their respective officers, directors, employees, agents and consultants, harmless from and against any and all claims, demands, causes of action, losses and penalties (including, without limitation, attorney’s fees) in any way related to the design, construction, operation, maintenance, ownership, repair, disconnection and removal of the Gathering System or other facilities relating thereto or the ▇▇▇▇▇ Station, ▇▇▇▇▇ Station, or its truck unloading facilities (including, without limitation, all environmental liability), except, and to the extent that, such claims, demands, causes of action, losses and penalties are resulting from or attributable to CLR’s gross negligence or willful misconduct. This provision shall survive termination of this agreement. |
| EXPANSION OF SCOPE: |
The parties recognize that the list of properties attached hereto and covered hereby may change as CLR’s regional business expands. The list of properties covered hereby may be expanded, altered or amended by written consent executed by the parties. |
| AUDIT RIGHTS: | Each party shall have the right at all reasonable times, upon written request, to audit all records of the other party pertinent to this agreement to verify such party’s compliance with the terms and conditions of this agreement. Notwithstanding the foregoing, each party shall be entitled to protect the confidentiality of all information it considers proprietary. If any audit conducted pursuant to this section reveals that there was an inaccuracy or omission in the invoices submitted under this agreement, the parties shall, within ten (10) days of a request by either party therefore, meet to discuss the adjustments and/or payments that would be necessary to correct such inaccuracy or omission; provided, however, that no adjustments and/or payment shall be made with respect to any inaccuracy or omission first alleged after the second anniversary of the date of the invoice containing such inaccuracy or omission. |
| NOTICES: | Any notice to be given under this agreement shall be in writing and shall be deemed to have been given to the party to whom it is addressed on the date presented in person or 3 days following the date of mailing if sent by prepaid first class mail or, if delivered via facsimile transmission, 4 hours following the time of transmission of such facsimile provided such deemed receipt is within normal business hours of the recipient party, failing which such notice will be deemed to have been received at the commencement of the next following business day. Any notice to be given shall be given in accordance with the following particulars or such other particulars of which a party shall have notified the other: |
CLR:
Banner Pipeline Company, LLC.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
▇. ▇. ▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
BANNER:
Banner Transportation Company, LLC
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
| PERFORMANCE INTERRUPTION: |
The parties hereto shall be excused from the performance of their obligations hereunder, except the obligation to make monetary payments, when and to the extent that such performance is delayed by fire, explosion, act of God, strike, labor dispute or other industrial disturbance, storm, lightening, earthquake, civil disturbance or any other cause not within the reasonable control of the party claiming a suspension, provided that such party shall give notice to the other party, stating full particulars of such event, as soon as possible after the occurrence thereof, and shall as far as possible, remedy such situation with all reasonable dispatch, provided that nothing herein shall be construed to require a party to settle a labor dispute. For greater certainty, lack of governmental approvals resulting from a failure to make application in a timely manner shall not excuse a party from performance hereunder. |
| INVALIDITY: | If any provisions of this agreement are invalid under any applicable statute or rule of law, they are to that extent, omitted, but the remainder of this Agreement shall continue to be binding upon the parties hereto. |
| ASSIGNMENT: | Neither party may assign this agreement without the prior written consent of the other party. |
| WAIVER: | The waiver by either party of any default or breach of this agreement by the other party shall not bar such party from its right to enforce this agreement in the event of any subsequent default or breach. |
| BINDING: | This agreement shall be binding upon and shall inure to the benefit of the successors and permitted assigns of the parties. |
| LAW: | This agreement shall be governed by and construed, interpreted and enforced in accordance with the laws of the State of Oklahoma without giving effect to the principles of conflicts of laws thereof. Each of the parties hereto hereby irrevocably consents and submits to the exclusive jurisdiction of the courts of the State of Oklahoma for the purposes of any controversy, claim, dispute or action arising out of or related to this agreement, and hereby waives any defense of an inconvenient forum and any right of jurisdiction on account of his place of residence or principal place of business. The substantially prevailing party in any such controversy, claim, dispute or action shall be entitled to recover reasonable attorneys’ and expert witness’ fees. |
| ENTIRETY: | This agreement constitutes the entire agreement between the parties hereto pertaining to the transportation of crude oil on the Gathering System or delivery of crude oil to the ▇▇▇▇▇ Station or ▇▇▇▇▇ Station, and this agreement shall govern in respect of all matters referred to herein and wholly replaces and supersedes any and all previous agreements, understandings, negotiations and discussions, whether oral or written, of the parties hereto pertaining to the transportation or delivery of crude oil to said facilities. |
IN WITNESS WHEREOF, the parties hereto have signed and delivered this Crude Oil Transportation Agreement this 11th day of July, 2007.
| BANNER PIPELINE COMPANY, LLC. | ||
| /s/ ▇▇▇▇ ▇▇▇▇▇▇ | ||
| By: |
▇▇▇▇ ▇▇▇▇▇▇ | |
| Title: |
President, Continental Resources, Inc. | |
| Member | ||
| BANNER TRANSPORTATION COMPANY, LLC | ||
| /s/ ▇▇▇▇▇▇ ▇▇▇▇ | ||
| By: |
▇▇▇▇▇▇ ▇▇▇▇ | |
| Title: |
Member | |
EXHIBIT “A”
Leases to be shipped on Gathering System to Banner’s ▇▇▇▇▇ Station and ▇▇▇▇▇ ▇▇▇▇▇▇▇
| ▇ | ▇▇▇▇▇ ▇-▇▇▇ | |||||
| ▇ | ▇▇▇▇ 1-25H | |||||
| 3 | ▇▇▇▇▇▇▇ 1-10H | |||||
| 4 | ▇▇▇▇▇▇ 1-6H | |||||
| 5 | ▇▇▇▇▇▇ 1-26H | |||||
| 6 | ▇▇▇▇▇ 1-5H | |||||
| 7 | ▇▇▇▇▇ 1-28H | |||||
| 8 | CHERRY 1-20H | |||||
| 9 | ▇▇▇▇▇▇▇ 1-20H | |||||
| 10 | ▇▇▇▇▇▇▇▇▇ 1-7H | |||||
| 11 | ▇▇▇▇▇▇▇▇▇ 2-18H | |||||
| 12 | ▇▇▇▇▇▇▇ 1-4H l | |||||
| 13 | ▇▇▇▇ 1-24H | |||||
| 14 | ▇▇▇▇▇▇ 1-5H | |||||
| 15 | ▇▇▇▇ 34-26H & 2-26H | |||||
| 16 | ▇▇▇▇▇ 1-31H | |||||
| 17 | HILL 1-36H | |||||
| 18 | ▇▇▇▇▇▇▇▇▇ 1-14H | |||||
| 19 | ▇▇▇▇▇ 13-5 | |||||
| 20 | ▇▇▇▇▇ 1-34H | |||||
| 21 | JUNE 1-8H | |||||
| 22 | ▇▇▇▇▇ 1-10H | |||||
| 23 | ▇▇▇ 1-12H | |||||
| 24 | ▇▇▇▇▇▇ | |||||
| 25 | LAZY D 1-9H | |||||
| 26 | ▇▇▇▇▇▇ 1-13H | |||||
| 27 | ▇▇▇▇▇▇▇ 1-27 | |||||
| 28 | ▇▇▇▇▇▇▇▇ 2-15H | |||||
| 29 | ▇▇▇▇▇▇▇▇ 44-15H | |||||
| 30 | ▇▇▇▇▇ 1-35H | |||||
| 31 | ▇▇▇▇▇▇ 1-34H | |||||
| 32 | MONDALIN 1-10H | |||||
| 33 | ▇▇▇▇▇▇ 1-31H | |||||
| 34 | ▇▇▇▇▇ 1-7 | |||||
| 35 | ▇▇▇▇▇▇▇ ▇-▇▇ | |||||
| ▇▇ | ▇▇▇▇▇▇▇ ▇-▇▇▇ | |||||
| ▇▇ | ▇▇▇▇ ▇-▇▇▇ | |||||
| 38 | ▇▇▇▇▇ 1-11H | |||||
| 39 | STONEY BUTTE FARM 1-17 | |||||
| 40 | STONEY BUTTE FARM 2-8 | |||||
| 41 | SWENSEID 1-9H | |||||
| 42 | ▇▇▇▇▇▇ 1-22H | |||||
| 43 | ▇▇▇▇ | |||||
| 44 | ▇▇▇▇▇ 1-31H | |||||
| 45 | ▇▇▇▇▇▇▇ 1-26H |
EXHIBIT “B”
Leases for non-pipeline delivery and unloading at Banner’s ▇▇▇▇▇ Station and ▇▇▇▇▇ Station, all from Richland County Montana:
| AZALEA 1-6H | ||
| BABKA 1-12H | ||
| ▇▇▇▇▇▇▇ 1-21H | ||
| BETTSYE 1-8H | ||
| BIG SKY 1-35H | ||
| ▇▇▇▇▇ 1-33H | ||
| ▇▇▇▇▇▇ 1-18H & 2-18H | ||
| CHARLOTTE TANK BATTERY | ||
| ▇▇▇▇▇ 1-17H | ||
| ELM 1-12H | ||
| ▇▇▇▇▇ 1-31H | ||
| ▇▇▇▇▇ 2-31H | ||
| ▇▇▇▇▇▇▇▇ TANK BATTERY | ||
| ▇▇▇▇▇ 1-19H | ||
| ▇▇▇▇ ▇▇▇▇▇▇ 1-2H | ||
| ▇▇▇▇▇▇▇▇▇ 1-15H | ||
| ▇▇▇▇▇▇▇▇▇ 1-5H | ||
| ▇▇▇▇ 1-22H | ||
| ROGNAS 1-22H | ||
| ▇▇▇▇▇▇▇▇ ▇▇-▇▇ | ||
| ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇-▇▇ | ||
| ▇▇▇▇▇ ▇-▇▇ | ||
| ▇▇▇▇▇▇ 1-23H | ||
| TIMBERCREEK 1-16H |