Download From: Lavery, Jane L [mailto:JLavery@chevron

From: Lavery, Jane L [mailto:[email protected]]
Sent: Tuesday, September 11, 2012 4:00 PM
To: Sappenfield, Keith; 'Klecka, Ellen'
Subject: Comments on latest draft of NGL Standard GT&*C's definitions
Keith and Ellen,
Please note my comments in blue below for tomorrow’s meeting:
Definition of Ratable:
Ratable” shall mean the Contract Quantity that will be delivered and received, or exchanged, on a pro
rata basis (i) on each Day during the Delivery Month, or (ii) during the specific time period as set forth in
the Confirmation. “Ratable” means the Contract Quantity that will be delivered and received, or
exchanged, on a pro rata basis (i) on (i) each Day during the Delivery Month, or (ii) the specified Days of
Delivery as set forth in the Confirmation
Recommend to change the definition as follows: “Ratable” means the Contract Quantity that will be
delivered and received, or exchanged, on a pro rata basis on (i) each Day, (ii) or each week during the
Delivery Month, or (iii) the specified Days of Delivery as mutually agreed upon by the parties.
Note: The NGL distribution departments between the respective parties to a contract often
decided how many barrels per day or say 25,000 bbls per week are to be moved ratably. In drafting a
contract/confirmation normally the contract admin departments do not know when the barrels are
going to be scheduled so I recommend to delete “as set forth in the Confirmation”.
Also for example Chevron may purchase 15 truckloads of Normal Butane from a 3rd party and the
contract will say “approximately 15 trucks shipped on a ratable basis”. Contract admin will not
usually know when the schedulers are going to coordinate with the Seller or it’s truck loading facility.
Definition of Wet:
Wet” shall mean the Contract Quantity that will be delivered and received, or exchanged, on (i) the first
Day of a Delivery Month, or (ii) the specific Day(s) as set forth in the Confirmation. “
“Wet” means the Contract Quantity will be delivered and received, or exchanged, on the same Day
as the Transaction was entered into.
Note: That “wet” barrels may not move on the same day as the transaction date.
If the parties negotiate up front how many barrels per day they will move ratably on a given day or
week that can be incorporated into the Confirm however if the traders do not know at the time, I am
thinking that the in the definitions of both “Ratable” and “Wet” should not say it will be spelled out on
the confirm or a contract.
I have sent a request to one of my Belvieu traders and distribution coordinator for a definition of “On
Demand”. When I receive that information I will forward this on to you all.
Thank you.
Jane Lavery
LSAT Contract Analyst
Chevron Products Company,
A Division of Chevron U.S.A. Inc.
1500 Louisiana St., 7th Floor, Houston, TX 77002
Tel 832 854 2688 Fax 866 947 4510
[email protected]