MARINE DOCK AND TERMINALING AGREEMENT

Exhibit 10.20

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MARINE DOCK AND TERMINALING AGREEMENT

Between

SUNOCO PARTNERS MARKETING & TERMINALS L.P.

and

MOTIVA ENTERPRISES LLC

Dated as of December 15, 2006

 

THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL

TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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MARINE DOCK AND TERMINALING AGREEMENT

This Marine Dock and Terminaling Agreement (the “Agreement”) is made and entered into on this 15th day of December, 2006 by and between Sunoco Partners Marketing and Terminals L. P., a Texas limited partnership ("Sunoco Partners"), and Motiva Enterprises LLC, a Delaware Limited Liability Company (“Motiva”). (Sunoco Partners and Motiva shall be hereinafter referred to individually as “Party” or collectively as the “Parties”).

WITNESSETH

WHEREAS, Sunoco Partners owns and operates a marine storage and terminaling facility which is located at or near Nederland, Texas, including marine docks, tanks, and all other facilities and services in connection with the receipt, storage, measurement and delivery of crude oil from vessels and connecting pipelines (the “Nederland Terminal”);

WHEREAS, Motiva is a refining and marketing company that owns a refinery and related facilities located at Port Arthur, Jefferson County, Texas, including the facility located in Port Neches, Texas (the “Port Arthur Refinery”);

WHEREAS, Sunoco Partners proposes to design, engineer, construct and complete certain enhancements to the Nederland Terminal, as further described herein (the “Nederland Terminal Expansion”), and to achieve Facility Mechanical Completion by no later than January 1, 2010;

WHEREAS, the Parties hereto mutually desire that during the term of this Agreement Sunoco Partners shall provide certain terminaling services at the Nederland Terminal to Motiva, including delivery of crude oil to the approximately 12.1 mile, 30” pipeline linking the Nederland Terminal to the Port Arthur, Texas Refinery (the “Pipeline”);

 

2

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WHEREAS, Motiva and Sunoco Pipeline L.P. (“Sunoco”) will enter into a Throughput & Delivery Agreement for the receipt, transportation and delivery of Crude Oil from the Nederland Terminal to the Port Arthur Refinery via the Pipeline, as well as construction services related thereto (the “T&D Agreement”).

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, Sunoco Partners and Motiva hereby agree:

1.0 TERM OF THE AGREEMENT

This Agreement shall be in full force and effect on the Effective Date; however, the Term of this Agreement shall commence upon the Commencement Date (defined in Section 2.6) and, subject to the termination provisions set forth herein, shall continue for a term of ten (10) Contract Years (the “Term”). The Parties agree to enter good faith renewal negotiations following receipt of written notification by one Party to the other no later than four (4) years prior to the end of the Term. If the Parties cannot agree on the terms and conditions of a renewal of this Agreement within six (6) months from the date of the written notification, this Agreement will terminate at the end of the Term.

2.0 CONSTRUCTION AND COMMENCEMENT DATE

2.1 Sunoco Partners, at its sole cost and expense, will design, engineer, modify, construct, and equip, or caused to be designed, engineered, modified, constructed, and equipped, the Nederland Terminal in accordance with the specifications for the Nederland Terminal Expansion listed in EXHIBIT A . Without limitation to the foregoing, EXHIBIT A shall also include a construction schedule for the Nederland Terminal Expansion, construction progress reporting procedures, and capacity requirements designed to ensure that, following the Nederland Terminal Expansion, the Nederland Terminal will

 

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have sufficient capacity to receive, handle and store Crude Oil per Motiva’s requirements, as well as deliver such Crude Oil to the Pipeline. Should Motiva desire to change the scope of the Nederland Terminal Expansion after the Effective Date or during the Term hereof, the Parties will work together in good faith to implement any such change.

2.2 Motiva, at its option, may be represented on Sunoco Partners’ construction team, and may have a representative present at any and all times at all locations where Sunoco Partners or its subcontractors are engaged in the construction and/or operation of any part of the Nederland Terminal, in each case in an observer capacity only; provided, however, that Motiva shall have no rights to direct or control the construction and/or operation of the Nederland Terminal.

2.3 Sunoco Partners shall apply for and use commercially reasonable efforts to secure commercially reasonable terms on all rights-of-way (whether from private parties or any governmental agency or authority); licenses; permits; property rights of ingress and egress; certificates; servitudes; judgments, orders, or ruling; patents or patent licenses; operating agreements; and other authorizations (collectively “Authorizations”) as may be required for the purpose of providing, modifying, constructing, operating and maintaining the Nederland Terminal. Motiva shall use commercially reasonable efforts to comply with any commercially reasonable request from Sunoco Partners for assistance in seeking Authorizations.

2.4 The design and construction at the Nederland Terminal shall materially comply with all applicable federal, state, and local laws, regulations, ordinances, orders, and directives and generally accepted pipeline industry standards.

 

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2.5 As of the Effective Date, Sunoco Partners shall begin engineering and other work with respect to the Nederland Terminal Expansion and shall use all commercially reasonable efforts to cause the Nederland Terminal Expansion to achieve Facility Mechanical Completion on or before January 1, 2010, provided that this date shall be extended by any period of Force Majeure, by delays due to regulatory matters or inclement weather, or as may otherwise be agreed in writing by the Parties.

(a) Notwithstanding the foregoing, and as an incentive to achieving Facility Mechanical Completion of the Nederland Terminal Expansion ahead-of-schedule, Motiva will pay Sunoco Partners the Throughput Fees outlined in Section 7.1, plus [******] (the “Incentive Payment”), if (1) Sunoco Partners achieves Facility Mechanical Completion of the Nederland Terminal Expansion by December 1, 2009; and (2) Sunoco achieves Pipeline Mechanical Completion of the Pipeline, as required by the T&D Agreement, by December 1, 2009. Such Incentive Payment will only apply on the first [******] Barrels stored and handled at the Nederland Terminal during the first Contract Year.

(b) Should Sunoco Partners not achieve Facility Mechanical Completion of the Nederland Terminal Expansion by January 1, 2010, or should Sunoco not achieve Pipeline Mechanical Completion of the Pipeline, as required by the T&D Agreement, by January 1, 2010, for reasons other than Force Majeure, and should the Facility Mechanical Completion of the expansion project at the Port Arthur Refinery have been achieved by that date, then Sunoco Partners will credit Motiva (in the form of Prepaid Terminaling Credits) with the Base Throughput Fee multiplied by the pro rata Base Volume Amount for the period from January 1, 2010 until the Commencement Date, subject to Motiva’s obligation to exercise its commercially reasonable efforts to minimize such damages.

 

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(c) Should Sunoco Partners achieve Pipeline Mechanical Completion on or before December 1, 2009, and provided that Sunoco Partners has achieved Facility Mechanical Completion of at least one storage tank at the Nederland Terminal, then upon notice by Sunoco to Motiva of such Facility Mechanical Completion, Motiva shall throughput Crude Oil or cause Crude Oil to be throughput at the Facility, at the Base Throughput Fee outlined in Section 7.1, a minimum guaranteed volume of [******] Barrels per month (the “Pre-Commencement Date Obligation”), from the date of first crude oil delivery until the Commencement Date. Any excess or shortfall of the Pre-Commencement Date Obligation during any month prior to the Commencement Date shall be cumulatively carried forward to each succeeding month. Should Motiva fail to throughput the total Pre-Commencement Date Obligation by the end of the month immediately preceding the Commencement Date, then Motiva shall have the obligation to make a payment to Sunoco in an amount equal to the amount of such shortfall in barrels for the Pre-Commencement Date Obligation multiplied by the applicable rate, and Motiva shall have no further obligation to throughput any shortfall of Pre-Commencement Date Obligation barrels. Such payment to Sunoco will be made within fifteen (15) days after the Commencement Date.

2.6 The “Commencement Date” of this Agreement shall be the latter of: (i) the date that the expansion project at the Port Arthur Refinery achieves Facility Mechanical Completion; or (ii) the first day of the month following the date Sunoco Partners notifies

 

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THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL

TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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Motiva in writing that Sunoco Partners has achieved Facility Mechanical Completion of the Nederland Terminal Expansion. Without prejudice to the foregoing, if the Commencement Date has not occurred by July 1, 2010 because the expansion project at the Port Arthur Refinery has not achieved Facility Mechanical Completion, then Motiva shall begin to pay Throughput Fees to Sunoco Partners, calculated based on the pro rata portion of the Base Volume Amount for the time period from July 1, 2010 until the Commencement Date, and Motiva shall receive Prepaid Terminaling Credits corresponding to such payments, subject to the provisions of Section 6.

2.7 Without prejudice to any other provision of this Agreement, Motiva shall have the option, exercisable at any time before 11:59 p.m. on July 1, 2007, to provide a written notice instructing Sunoco Partners to proceed with the construction of the dock and related facilities described on EXHIBIT B, under the terms provided therein (the “ [******] Option”).

3.0 FACILITIES TO BE PROVIDED BY SUNOCO PARTNERS.

As part of the services to be provided at the Nederland Terminal, Sunoco Partners shall provide to Motiva the use of the following facilities at the Nederland Terminal in accordance with the terms and conditions set forth herein.

3.1 Facilities for Motiva’s Exclusive Use

During the Term, Sunoco Partners shall make the following facilities and related services at the Nederland Terminal available for Motiva’s exclusive use:

 

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(a) Sunoco Partners will provide Motiva with exclusive use of the following storage tanks:

 

(b) Substitution of similar storage tanks when required for Sunoco Partners’ convenience will be as mutually agreed between Sunoco Partners and Motiva.

(c) At Sunoco Partners’ discretion, any tank cleaning and gas freeing of storage tanks required at the end of the Term or as the result of a change of service will be paid by Motiva at Sunoco Partners’ actual cost (subject to verification by Motiva). Tank cleaning means squeegee clean suitable for Crude Oil service and gas freeing refers to tank farm safety standards and not certified hot work.

(d) Motiva will maintain a sufficient quantity of Crude Oil at the Nederland Terminal to float the roofs of the storage tanks until time of final exit of the Crude Oil, consistent with agreed operating procedures established between Sunoco Partners and Motiva.

3.2 For Motiva’s Non-Exclusive Use

During the Term, Sunoco Partners will provide, operate, and maintain for Motiva’s non-exclusive use at the Nederland Terminal facilities consisting of lines, pipes, gauges, berths, and pumping sufficient to receive and deliver Motiva’s Crude Oil, including the following:

 

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(a) The use of the following ship berths:

 

The above ship berths shall have the following equipment:

 

Sunoco shall exercise its commercially reasonable efforts to maintain the water depth at each of these ship berths at 40 (forty) feet below mean low water.

 

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TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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(b) A mainline pump station and metering facility for deliveries of Crude Oil to the Pipeline will be provided and operated by Sunoco Partners. Capacity of such mainline pump station will be sufficient to provide up to [******] BPH pumping rate at a discharge pressure of 500 psig when pumping Crude Oil, based on the following assumptions:

(i) Pumping through the Pipeline from the Nederland Terminal to the Port Arthur Refinery.

(ii) Crude Oil with characteristics of 21º API Gravity and 500 SSU viscosity.

(iii) Delivery pressure at the inlet to the metering facility at the Port Arthur Refinery at 80 psig.

(c) A delivery metering facility for measurement to the Pipeline will be provided and operated by Sunoco Partners. The capacity of such facility will be a maximum of [******] BPH.

4.0 MAINTENANCE OF THE NEDERLAND TERMINAL

During the Term, Sunoco Partners shall use commercially reasonable efforts to operate the Nederland Terminal so as not to interrupt the flow of ratable deliveries to the Port Arthur Refinery, including by maintaining the Nederland Terminal and scheduling shutdowns for preventive maintenance in a manner that minimizes disruptions to Motiva hereunder. To the extent reasonably possible, Sunoco Partners shall provide Motiva with reasonable notice of any scheduled shutdown of the Nederland Terminal for maintenance which would materially and adversely affect Sunoco Partners’ performance hereunder. Sunoco Partners shall promptly perform any unscheduled maintenance of the Nederland Terminal, including without limitation any unscheduled maintenance required or reasonably requested by Motiva. During the Term of this Agreement, Sunoco will make commercially reasonable efforts to operate the Pipeline.

 

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THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL

TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

5.0 SERVICES TO BE PERFORMED BY SUNOCO PARTNERS

5.1 Sunoco Partners agrees to receive deliveries of Crude Oil into the Nederland Terminal by vessel and to store such Crude Oil in tanks provided for Motiva’s use pursuant to Section 3.1, all in accordance with terms of this Agreement and conditions set forth in the latest edition of the Nederland Terminal Port Manual.

5.2 All Crude Oil received hereunder by Sunoco Partners shall have properties within the following limits:

 

Sunoco Partners shall have no obligation to receive or handle any of Motiva’s Crude Oil with properties that do not meet the criteria specified above. Sunoco Partners may, in its sole discretion, elect to receive and handle such non-conforming Crude Oil, subject to the physical limitations of the Nederland Terminal and general terminal industry practice. In no event, however, shall Sunoco Partners be required to receive into storage tanks at the Nederland Terminal any Crude Oil with properties which would result, in Sunoco Partners’ sole opinion, in Sunoco Partners’ non-compliance with federal, state, or local regulatory requirements applicable to the Nederland Terminal.

 

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5.3 Sunoco Partners will perform routine physical inspections and laboratory tests of Crude Oil shipments and receipts in order to properly identify shipments and in order to ensure conformance with the above criteria. Motiva shall have the right to witness such inspections and tests.

5.4 Deliveries from the Nederland Terminal storage tanks will be made to the Pipeline in accordance with Motiva’s reasonable instructions and with scheduling practices for the Pipeline.

5.5 Sunoco Partners receives and delivers both sweet Crude Oil and sour Crude Oil (for the purpose of this Agreement, “sour Crude Oil” means Crude Oil with sulphur content greater than 0.5%) through certain common usage facilities (i.e., dock lines, pump suction lines, pumps, etc.). Mixing of sweet and sour Crude Oil in common usage facilities during receipt and redeliveries of Motiva's Crude Oil may occur. Motiva agrees that Sunoco Partners will not be liable for any resultant downgrading due to the mixing of Motiva's Crude Oil in common usage facilities at the Nederland Terminal. Sunoco Partners agrees to use commercially reasonable efforts to operate such common usage facilities in a manner which minimizes such downgrading, provided, however, that Sunoco Partners shall not be required to make line displacements.

 

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TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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6.0 THROUGHPUT OBLIGATION AND DEFICIENCY PAYMENT

6.1 During each Contract Year of the Term or any renewal thereof, Motiva will throughput or cause to be throughput at the Nederland Terminal a volume of [******] Barrels of Crude Oil (the “Base Volume Amount”).

6.2 At the conclusion of each Contract Year, an accounting will be made of the quantities of Crude Oil that Motiva has throughput or caused to be throughput at the Nederland Terminal during such Contract Year. If, during any Contract Year, the shipments of Crude Oil that Motiva throughput or caused to be throughput at the Nederland Terminal do not meet or exceed the Base Volume Amount, then Motiva shall receive prepaid terminaling credits (“Prepaid Terminaling Credits”) equal to the difference between the Base Volume Amount and the number of Barrels of Crude Oil that Motiva actually throughput or caused to be throughput at the Nederland Terminal during that Contract Year (the “Base Volume Shortfall”).

6.3 Motiva may use Prepaid Terminaling Credits as credits against the payment of terminaling charges for Crude Oil that Motiva may throughput or cause to be throughput at the Nederland Terminal during the succeeding two (2) Contract Years, subject to Section 6.4 below. In the event Motiva holds unused Prepaid Terminaling Credits at the time of the termination or expiration of this Agreement (except for a termination by Sunoco Partners for a Motiva default), then Motiva shall have the one (1) year period immediately following such termination or expiration to use such Prepaid Termination Credits. In such event, Motiva shall notify Sunoco Partners of the number of Prepaid Termination Credits that Motiva plans to use during that one (1) year period, and within 30 (thirty) days of that notice, Motiva will provide to Sunoco Partners a schedule for the corresponding throughputs at the

 

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Nederland Terminal. Sunoco Partners shall designate tankage and facilities at the Nederland Terminal for Motiva’s throughputs according to that schedule. Any Prepaid Terminaling Credits that remain at the end of the one (1) year period will expire.

6.4 Motiva must first meet or exceed the Base Volume Amount during the applicable succeeding Contract Year before any Prepaid Terminaling Credits may be applied for quantities in excess of the Base Volume Amount; provided, however, that Motiva shall not be required to meet or exceed the Base Volume Amount in order to use Prepaid Terminaling Credits during the one (1) year period immediately following the termination or expiration of this Agreement.

6.5 If Motiva is unable to throughput the Base Volume Amount during any Contract Year due to Sunoco Partners’ failure to operate the Nederland Terminal in accordance with generally accepted terminal industry standards and the terminal industry practices and procedures used by a commercially reasonable operator, the Prepaid Terminaling Credits arising from the Base Volume Shortfall attributable to Sunoco Partners’ failure may be utilized by Motiva during any succeeding Contract Year during the Term or during the one (1) year period immediately following the termination or expiration of this Agreement (except for a termination by Sunoco Partners for a Motiva default).

7.0 FEES

7.1 Each Contract Year during the Term, Motiva shall pay to Sunoco Partners an amount equal to [******] Barrels multiplied by the then-current Throughput Fee (the “Base Throughput Fee”). The Base Throughput Fee in effect on the Effective Date will be [******] for each Barrel of Crude Oil, subject to indexation in accordance with the provisions of Section 7.8.

 

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TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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7.2 For any Barrel of Crude Oil that Motiva throughputs during any Contract Year in excess of the Base Volume Amount, but less than [******] Barrels, Motiva shall pay to Sunoco Partners a Throughput Fee of [******] per Barrel, subject to indexation in accordance with the provisions of Section 7.8.

7.3 For any Barrel of Crude Oil that Motiva throughputs during any Contract Year in excess of [******] Barrels, Motiva shall pay to Sunoco Partners a Throughput Fee of [******] per Barrel, subject to indexation in accordance with the provisions of Section 7.8.

7.4 Motiva shall pay to Sunoco Partners a transfer fee of [******] for each Barrel of Crude Oil transferred at Motiva's request from a Motiva tank(s) to another Motiva tank at the Nederland Terminal. Barrels of Crude Oil so transferred shall not be charged against the Base Volume Amount.

7.5 Motiva shall pay to Sunoco Partners a marine loading fee of [******] for each Barrel of Crude loaded onto a ship or barge at the Nederland Terminal at Motiva’s request, subject to a determination by Sunoco Partners that operating conditions permit such loading.

7.6 All additional charges for mooring and unmooring of ships, independent inspection, laboratory testing, and other fees and costs required by the Nederland Terminal Port Manual shall be paid by Motiva.

7.7 Motiva hereby represents that it is properly registered with the Texas Comptroller of Public Accounts and will pay amounts corresponding to the Texas Coastal Protection Fee directly.

 

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7.8 Sunoco Partners and Motiva agree that beginning on the first annual anniversary of the Effective Date, all of the charges, prices, and fees stipulated in Section 7 will be subject to adjustment to reflect the positive or negative rate changes in the final Producers Price Index for Finished Goods (seasonally adjusted) as published by the U.S. Department of Labor, Bureau of Labor Statistics, for the previous twelve (12) month period. Adjustments will be calculated as follows:

Adjusted Fee = Throughput Fee for the immediately prior year + Adjustment

Where: Adjustment = [P2/P1 – 1 ] x (Throughput Fee for the immediately prior year)

Where:

P1 is the final Producers Price Index for Finished Good (PP1-FG)(seasonally adjusted) as published by the U.S. Department of Labor, Bureau of Labor Statistics, for the Contract Year immediately preceding the prior year.

P2 is the final Producers Price Index for Finished Goods (PP1-FG)(seasonally adjusted) as published by the U.S. Department of Labor, Bureau of Labor Statistics, for the prior year.

The adjustment calculated herein shall be capped at [******] per year during the period from the Effective Date until the Commencement Date. The Parties agree that the Throughput Fees for any Contract Year shall not be lower than the Throughput Fees in effect on the Effective Date.

7.9 In the event that during the term of this Agreement, any existing codes and applicable law, codes, or regulations are amended or new laws, codes and regulations are enacted or promulgated which, in either case, (a) generally apply to, affect, or impact all domestic, crude oil terminals which are located (whether entirely or partially) in the State of Texas and which are of comparable size, age, throughput capacity, and operational capability as the Nederland Terminal, and (b) will require Sunoco Partners to incur prior to the end of the Term (1) a capital expense improvement in excess of [******] to the berths, the tanks,

 

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and/or any other portion of the Nederland Terminal which is used by or for the benefit of Motiva under the terms of this Agreement, or (2) an increase in excess of [******] per Contract Year in the cost of operating the berths, the tanks, and/or any other portion of the Nederland Terminal which is used by or for the benefit of Motiva under the terms of this Agreement, then Sunoco Partners shall, upon written notice to Motiva, have the right to initiate negotiations for an adjustment in any of the charges and fees hereunder in order to compensate Sunoco Partners for any such additional fees, levies or costs.

In connection with Sunoco Partners’ request to initiate negotiations to adjust any of the charges, fees, or rates set forth in this Section 7, Sunoco Partners shall provide Motiva, at least ninety (90) days in advance of the effective date of any tariff adjustment, with a proper showing of the governmental requirement for such improvements, with a detailed description of the costs and expenses that Sunoco Partners would incur for such improvements, and an explanation of how such improvements are the most cost effective means to conform to such governmental requirements. Motiva shall have the right to verify such estimated costs and to inspect any of Sunoco Partners’ records related thereto.

If the Parties hereto are unable to mutually agree on an adjustment in the applicable tariff rates set forth in the Throughput Fee before it becomes necessary for Sunoco Partners to take such action so as to be in compliance with the new or amended law, code or regulation, Sunoco Partners shall charge, and Motiva shall pay the new tariff rate as specified by Sunoco Partners; provided, however, that Motiva may dispute the new tariff. In such event, Sunoco Partners shall seek to resolve such dispute in accordance with the procedures set forth in Section 26 hereof, and in the event such procedures result in a new tariff that is lower than that imposed by Sunoco Partners, Sunoco Partners shall refund to Motiva the amounts paid in excess of the new tariff so determined,

 

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TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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for each volume of Crude Oil stored by Motiva at the Nederland Terminal during the period in which the dispute was pending resolution, plus interest at the Prime rate charged by Citibank, N.A., New York, calculated from the date of the Sunoco Partners notice provided under the first paragraph of this Section 7.9 until the date such new tariff is determined in accordance with Section 26.

8.0 BILLING AND PAYMENT

Sunoco Partners shall submit invoices to Motiva hereunder as follows:

8.1 Sunoco Partners shall invoice Motiva on or before the tenth (10th) day of each month for an amount corresponding to (i) one twelfth of the Base Volume Amount multiplied by the Base Throughput Fee; plus (ii) any amounts otherwise due and payable under Section 7 for the previous month;

8.2 Subject to Section 8.3, Motiva shall pay Sunoco Partners within twenty (20) days from the invoice date, regardless of whether the invoice was received before, on, or after the tenth (10th) day of the month, the amount specified on the invoice. Such payment shall be made by electronic transfer of immediately available funds to the bank and bank account set forth on each invoice. For any invoice submitted hereunder, Sunoco Partners shall provide any supporting documentation reasonably requested by Motiva.

8.3 Although Motiva may dispute in good faith the amount of any such invoice, Motiva shall timely pay to Sunoco Partners all amounts which Motiva concedes are correct. Motiva shall promptly notify Sunoco Partners in writing of any such dispute, and following receipt of such notice, Sunoco Partners shall promptly work with Motiva to resolve the dispute. If Motiva fails to pay any disputed amount within sixty (60) days after the date on

 

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TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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which the Parties have finally resolved or settled such amount, or payment of such disputed amount has been finally adjudicated or otherwise resolved, whichever occurs first, Sunoco Partners, in addition to any other remedies it may have, may suspend service under this Agreement. No payment by Motiva of the amount of a disputed invoice shall prejudice the right of Motiva to claim an adjustment of the disputed invoice so long as such invoice is disputed in accordance with this paragraph.

8.4 Should Motiva fail to pay part or all of the amount of any undisputed invoice, or any disputed invoice which has been resolved for a period of sixty (60) days following the due date thereof, then Sunoco Partners may charge interest at the prime rate charged by Citibank, N.A., New York, New York (or any successor thereof) on the unpaid portion of the invoice, computed from the date payment is due until the date payment is received. If such failure to pay continues for sixty (60) days after such payment is due, Sunoco Partners, in addition to any other remedy it may have hereunder or otherwise, may suspend further service for Motiva under this Agreement until such undisputed amount is paid

9.0 INDEPENDENT CONTRACTOR

In performing services pursuant to this Agreement, Sunoco Partners is acting solely as an independent contractor maintaining complete control over its employees and operations. Neither Party is authorized to take any action in any way whatsoever for or on behalf of the other, except as may be necessary to prevent injury to persons or property, or, to contain, reduce or clean up any spills that may occur.

 

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TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [******] AND HAS

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10.0 FORCE MAJEURE

10.1 For purposes of this Agreement, “Force Majeure” shall mean, the occurrence of any of the following, for the period of time, if any, that the performance of a Party's material obligations under this Agreement are actually, materially, and reasonably delayed or prevented thereby, acts of God; strikes; lockouts; boycotts; picketing; labor or other industrial disturbance; explosions; nuclear reaction or radiation, radioactive contamination; acts of a public enemy; fires; acts of terrorism; explosions; material breakage of or material accidents to refinery equipment, the Nederland Terminal, lines of pipe, storage tanks, docks; wars (declared or undeclared); blockades; insurrections; riots; epidemics; landslides; earthquakes; storms; hurricanes; lightning; floods; extreme cold or freezing; extreme heat; washouts; arrests and restraints of governments (but excluding restraints occurring as a result of any violations, by the Party claiming the right to delay performance, of applicable law or the terms and provisions of this Agreement); confiscation or seizure by any government or public authority; compliance with any federal, state, or local law, or with any regulation, order, or rule of domestic or international governmental agencies, or authorities or representatives of any domestic or international government acting under claim or color of authority, including compliance with permitting regulation for the Nederland Terminal; the commandeering or requisitioning by United States civil or military authorities of any raw or component materials, Crude Oil, or facilities including, but not limited to, producing, manufacturing, transportation, and delivery facilities, and perils of navigation, even when occasioned by negligence, malfeasance, default, or errors in judgment; civil disturbances; or any other causes, whether of the kind herein enumerated or otherwise, the foregoing of which in any event are not (i) reasonably within the control of the Party (or its Affiliates) claiming the right to delay performance or (ii) the result of the gross negligence or willful misconduct of the Party (or its Affiliates) claiming the right to delay performance. Force Majeure shall not include (i) increases in costs of materials; or (ii) a party’s financial inability to perform.

10.2 Subject to the provisions of this Section 10, if a Party is prevented from performing its obligations under this Agreement due to an event of Force Majeure, then, to the extent that it is affected by the event of Force Majeure, the obligations of that Party shall be

 

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deferred during the continuance of that Party's inability to perform caused by the event of Force Majeure, but for no longer period. If a Force Majeure event renders any Party unable, in whole or in part, to carry out its obligations under this Agreement, that Party must give the other Party notice and full particulars in writing as soon as practicable after the occurrence of the causes relied on, or give notice by telephone and follow the notice with a written confirmation within forty-eight (48) hours. The Party providing the notice shall use commercially reasonable efforts to (a) ameliorate the conditions; (b) resume the continuation of its performance under this Agreement; and (c) minimize the impact of the condition on the other Parties. No Party shall be compelled to resolve any strikes, lockouts, or other industrial disputes other than as it shall determine to be in its best interests.

10.3 If a Force Majeure event declared by Sunoco Partners results in Motiva being unable to throughput or cause to be throughput the Base Volume Amount at the Nederland Terminal during any Contract Year(s), then the Base Volume Amount for such Contract Year(s), shall be reduced in the same proportion and for the same period of time as Motiva’s ability to throughput is so affected, and Motiva shall have no obligation (including payment obligation) for any amount in excess of the reduced volume. If a Force Majeure event extends (or is reasonably expected to extend) beyond two hundred seventy (270) days, or upon notice from Sunoco Partners that such Force Majeure event is reasonably expected to extend beyond two hundred seventy (270) days, Motiva may terminate this Agreement, negotiate new Throughput Fees and/or negotiate to extend the Term.

10.4 If a Force Majeure event declared by Motiva results in Motiva being unable to throughput all or part of the Base Volume Amount at the Nederland Terminal or receive all or part of the Base Volume Amount at the Port Arthur Refinery during a Contract Year, then upon resolution of that Force Majeure event, Sunoco shall calculate a “Force Majeure Deficiency Volume,” defined herein as being equal to (1) the Base Volume Amount for the affected Contract Year; divided by (2) 365; multiplied by (3) the number of days during that Contract Year that the Force Majeure event was in effect; minus (4) the actual volume of Crude Oil that Motiva shipped through the Pipeline, if any, during the period affected by the Force Majeure event.

 

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(i) The occurrence of a Force Majeure event declared by M