UNILATERAL CHANGE ORDER FORM

EXHIBIT 10.15

SCHEDULE D-2

UNILATERAL CHANGE ORDER FORM

 

 

You are hereby directed to make the following additions or modifications to, or deductions from, the Work: (attach additional documentation if necessary)

Increase sendout pressure of the Natural Gas as measured at the back-pressure control valve located just upstream of the Master Meter from 1250 psig to 1440 psig. Piping from outlet of the high pressure sendout pumps through to and including the last flange of the LNG terminal shall be ANSI Class 900 lb. Temperature of sendout gas and all other requirements of the Minimum Acceptance Criteria and the Performance Guarantees as specified in Attachment S and Attachment T of the Agreement shall be remain the same.

Contractor shall proceed with design solely on the basis of a 1440 psig sendout pressure and prepare the required documentation, including a completed Schedule D-3 in accordance with Article 6.1A of the Agreement.

 

Compensation for the changes specified in this Change Order is on a time and materials basis as provided in Section 6.1C and 6.2D of the Agreement.

Contractor shall commence with the performance of the change(s) described above on January 18, 2005.

This Change Order is signed by Owner’s duly authorized representative.

 

/s/    Ed Lehotsky

Owner Representative Ed Lehotsky

 

January18, 2005

Date of signing

 

SCHEDULE D-1

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows:

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged.

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP

The Guaranteed Substantial Completion Date will be unchanged.

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP

Adjustment to other Changed Criteria: The Tank Subcontract will be awarded to MHI/MSI

Adjustment to Milestone Payment Schedule, Schedule C-1:

 

•

Milestone Number 2.02, LNG Tank Subcontract Awarded, will be increased by $1,500,000 from $3,234,680 to $4,734,680. The entire $1,500,000 increase will be provided as an increased payment to the LNG Tank Subcontractor MHI/MSI

 

•

Milestone Number 4.03, “LNG Tank test piling started,” will be decreased by $350,000 from $3,234,680 to $2,784,680 to offset the payment to MHI/MSI for LNTP, as described in the Adjustment to Payment Schedule, Schedule C-2 below

Adjustment to Monthly Payment Schedule, Schedule C-2:

 

•

Payment for Month #2, Feb-05, will be increased by $350,000 from $2,005,502 to $2,355,502. The entire $350,000 increase will be provided as a payment for Limited Notice to Proceed to the LNG Tank Subcontractor MHI/MSI

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Design Basis: None

Other adjustments to liability or obligation of Contractor or Owner under the Agreement:

MHI/MSI shall be awarded the Tank Subcontract

This Change Order shall constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and shall be deemed to compensate Contractor fully for such change.

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties, duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
				Name
				Project Director
				Title
				February 7, 2005
Date of Signing				Date of Signing
/s/ Keith Meyer
* Keith Meyer President
February 7, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
February 7, 2005
Date of Signing

 

*	Required Owner signature

SCHEDULE D-2

UNILATERAL CHANGE ORDER FORM

 

 

You are hereby directed to make the following additions or modifications to, or deductions from, the Work

Contractor shall delete the High Pressure Compressor from its scope (included in the reimbursable scope) and instead install only the tie-ins and space necessary for a “Future” diesel driven compressor. All other requirements of the Agreement shall remain the same.

Discussions with FERC indicate that they feel a High Pressure Sendout Compressor is required in case the LNG Tanks are de-inventoried in order to “mothball” the LNG Terminal. Since this is a very remote possibility, and since venting of this gas is neither a safety nor environmental concern, Owner will present formal arguments to FERC to delete this requirement. Failing this, Owner will propose to FERC that only connections and space are provided for this compressor. If the Terminal is mothballed, Owner will purchase or rent a portable compressor(s), heater, and other equipment, install it, and accomplish the required transfer to the pipeline.

Contractor shall proceed with design as described above and prepare the required documentation, including a completed Schedule D-3 in accordance with Article 6.1A of the Agreement.

Contractor shall commence with the performance of the change(s) described above on January 25, 2005.

This Change Order is signed by Owner’s duly authorized representatives.

 

/s/ Charif Souki				/s/ Keith Meyer
* Charif Souki Chairman				* Keith Meyer President
February 11, 2005				February 9, 2005
Date of Signing				Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
January 25, 2005
Date of Signing

 

*	Required Owner signature

SCHEDULE E-1

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows: Approval of Change Orders via Schedule D-1 and D-2 (Rev. 1) of the EPC Agreement will require the signatures of both Messrs. Charif Souki and Keith Meyer, in addition to the designated Owner Representative, Ed Lehotsky. This requirement will not apply to any other correspondence under the EPC Agreement.

A revised copy of Schedules D-1 and D-2 is attached reflecting the above change.

 

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged.

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP.

The Guaranteed Substantial Completion Date will be unchanged.

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP.

Adjustment to other Changed Criteria: None

Adjustment to Payment Schedule: None

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Performance Guarantees: None

Adjustment to Design Basis: None

Other adjustments to liability or obligation of Contractor or Owner under the Agreement: N/A

 

1

This Change Order shall constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and shall be deemed to compensate Contractor fully for such change.

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
				Name
				Project Director
				Title
				March 31, 2005
Date of Signing				Date of Signing
/s/ Keith Meyer
* Keith Meyer President
March 29, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
Date of Signing

 

*	Required Owner signature

 

2

SCHEDULE D-1

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows:

On March 14, 2005, Owner requested Contractor to delay placement of the following insurance coverages required under Section 7.1.B, Section 9.1 and Attachment O in the EPC Agreement as part of its effort to reduce the Actual Insurance Costs: the insurance coverages required under Section 1A.5, 1A.6, 1A.7, 1A.8, 1A.11, 1A.12 and 1A.14 of Attachment O; the increase in the coverage under Section 1A.4 of Attachment O from minimum limits of U.S.$10,000,000 to U.S.$100,000,000 each occurrence and aggregate; and certain insurance coverages specified in Section 1A.9 and 1A.10 of Attachment O , as specified in greater detail below.

In accordance with Attachment O , Section 1.B, Contractor shall procure the coverages specified in Sections 1A.4 (having the minimum limits of U.S. $100,000,000 for each occurrence and aggregate), 1A.5, 1A.6, 1A.7, 1A.8, 1A.11, 1A.12 and 1A.14 of Attachment O no later than June 3, 2005.

In accordance with Attachment O , Section 1.B, Contractor shall procure a portion of the coverages required under Sections 1A.9 and 1A.10 of Attachment O no later than NTP or as soon as reasonably possible thereafter. The Parties agree that the portion of insurance under Section 1A.9 and 1A.10 which is required to be procured by NTP or as soon as reasonably possible thereafter is specified in the attached term sheet. The difference in coverages between (a) the coverages specified in Section 1A.9 and 1A.10 of Attachment O and (b) the coverages specified in the attached term sheet shall be procured by Contractor no later than June 3, 2005. The terms and coverages specified in the attached term sheet are only approved for the purpose of determining the coverages required to be provided up to June 3, 2005.

Contractor’s obligation to notify and document the Actual Insurance Cost in Section 7.1.B of the Agreement shall be extended to June 3, 2005.

Owner understands that there is the potential that as a result of delayed purchase of those Project Insurances specified above that: 1) the final costs for the Project Insurances may increase beyond what would be obtainable at NTP, and 2) certain coverages required in the Project Insurances may become unavailable due to changes in the insurance market. The cost of the Project Insurances payable by Owner to Contractor shall be as provided under Section 7.1B.

 

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

 

1

The Target Bonus Date will be unchanged .

The Guaranteed Substantial Completion Date will be unchanged

Adjustment to other Changed Criteria: N/A

Adjustment to Payment Schedule: None

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Performance Guarantees: None

Adjustment to Design Basis: None

Other adjustments to liability or obligation of Contractor or Owner under the Agreement: None

This Change Order shall not constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and therefore shall not be deemed to compensate Contractor fully for such change.

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
				Name
				Project Director
				Title
				March 30, 2005
Date of Signing				Date of Signing
/s/ Keith Meyer
* Keith Meyer President
March 29, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
March 29, 2005
Date of Signing

 

*	Required Owner signature

 

2

SCHEDULE D-1

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows:

Attachment EE of the Agreement is replaced by the attached Attachment EE, Rev 1. All references in the Agreement to Attachment EE shall be understood to refer to Attachment EE, Rev 1.

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged .

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP

The Guaranteed Substantial Completion Date will be unchanged .

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP

Adjustment to other Changed Criteria: None

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Performance Guarantees: None

Adjustment to Design Basis: None

 

1

Other adjustments to liability or obligation of Contractor or Owner under the Agreement:

 

1.

In addition to the due Monthly Payments, Milestone Payments, and Reimbursable Costs described in the Agreement, Contractor shall invoice the applicable Tank Subcontract Materials Adjustment in the Month immediately following the Month in which the materials are received (ex-mill or ex-works) by the Tank Subcontractor, and Owner shall make payment to Contractor in accordance with Section 7.2E of the Agreement.

 

2.

To provide clarification, Owner and Contractor have jointly performed the sample calculations shown in Table 1 below using the formulas set forth in Sections 3.2 through 3.9 of Attachment EE Rev 1. The total and component amounts shown in Table 1 are the cost reimbursable material escalation amounts that would be due and payable to Contractor for the period from January 2004 through October 2004, subject to shipment of all affected materials. October 2004 was selected since the LNG Tank Subcontractor had initially updated its proposal to the Contractor as of that date. This escalation amount is not currently included in the Contract Price from Contractor to Owner.

Table I, Sample Calculation through October 2004

 

Owner, Contractor, and the Tank Subcontractor have also jointly developed a package, as per Contractor letter to Owner dated March 17, 2005, which provides supporting details and adequately documents the formulas for the Tank Subcontract Materials Adjustments shown in Attachment EE, Rev. 1. Contractor will confirm quantities provided by Tank Subcontractor for rebar by September 2005 and will confirm remaining quantities provided by Tank Subcontractor for structural steel by December 2005. All other quantities have been provided to Owner.

 

2

Attachment EE Rev 1 and the Change Order will prevail should any inconsistency occur between Contractor letter of March 17, 2005, and Attachment EE Rev 1 and the Change Order.

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
				Name
				Project Director
				Title
				April 26, 2005
Date of Signing				Date of Signing
/s/ Keith Meyer
* Keith Meyer President
April 21, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
April 20, 2005
Date of Signing

 

*	Required Owner signature

 

3

SCHEDULE D-l

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows:

 

1.

Refer to Article 7.1.B, “Insurance Allowance,” and incorporate the following “Actual Insurance Cost:”

 

 

 

2.

Refer to Article 7.1.B, “Insurance Allowance,” and the above “Actual Insurance Cost,” and increase the Contract Price by the difference as follows:

 

 

Page 1 of 3

3.

Refer to Article 7.1.B, “Insurance Allowance,” and Article 9.1.A, “Provision of Insurance,” and incorporate Attachment O, Revision 1, which is made a part of this Change Order by attachment. All references in the Agreement to Attachment O shall be understood to refer to Attachment O, Revision 1.

 

4.

Refer to Article 7.1.B, “Insurance Allowance,” and in the fourth line delete the words, “charterer legal liability” and replace with “marine general liability.”

 

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged .

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP.

The Guaranteed Substantial Completion Date will be unchanged .

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP.

Adjustment to other Changed Criteria: None

Adjustment to Payment Schedule: Refer to Schedule C-l “Milestone Payment Schedule” and add the following:

- Milestone Number 3.10 Actual Insurance Cost—Payment 1: $ 2,588,756

- Milestone Number 13.05 Actual Insurance Cost—Payment 2: $ 3,902,297

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Performance Guarantees: None

Adjustment to Design Basis: None

Other adjustments to liability or obligation of Contractor or Owner under the Agreement: None

This Change Order shall constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and shall be deemed to compensate Contractor fully for such change; provided, however, that the Parties acknowledge and agree that the “Actual Insurance Cost” herein is based on current estimates and is subject to further adjustment based on final costs for marine cargo insurance, marine general liability insurance, taxes for excess wind and flood coverage, and Marine Terminal Liability Operations insurance.

 

Page 2 of 3

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
Owner				Contractor
Charif Souki				C. Asok Kumar
Name				Name
CEO				Project Director
Title				Title
June 3, 2005				June 6, 2005
Date of Signing				Date of Signing
/s/ Keith Meyer
Owner
Keith Meyer
Name
Title
June 3, 2005
Date of Signing
/s/ Ed Lehotsky
Owner
Ed Lehotsky
Name
Owner Representative
Title
June 2, 2005
Date of Signing
/s/ Stanley C. Horton
Owner
Stanley C. Horton
Name
President and COO
Title
June 3, 2005
Date of Signing

 

Page 3 of 3

SCHEDULE D-l

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows:

Approval of Change Orders via Schedule D-l and D-2 of the EPC Agreement will require the signatures of Messrs. Charif Souki (except as further provided in the next sentence), Stan Horton, Keith Meyer, in addition to the designated Owner Representative, Ed Lehotsky. Mr. Horton is authorized to sign Change Orders on behalf of Mr. Souki during Mr. Souki’s absence. This requirement will not apply to any other correspondence under the EPC Agreement.

A revised copy of Schedules D-l (Rev 2) and D-2 (Rev 2) is attached reflecting the above change.

 

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged .

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP.

The Guaranteed Substantial Completion Date will be unchanged .

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP.

Adjustment to other Changed Criteria: None

Adjustment to Payment Schedule: None

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Performance Guarantees: None

Adjustment to Design Basis: None

Other adjustments to liability or obligation of Contractor or Owner under the Agreement: N/A

 

1

This Change Order shall constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and shall be deemed to compensate Contractor fully for such change.

Upon execution of this Change Order by Owner and Contractor, the above referenced change shall become a valid and binding part of the original Agreement without exception or qualification unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
				Name
				Project Director
				Title
June 20, 2005				June 23, 2005
Date of Signing				Date of Signing
/s/ Stan Horton
* Stan Horton President & COO Cheniere Energy
Date of Signing
/s/ Keith Meyer
* Keith Meyer President Cheniere LNG
June 17, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
Date of Signing

 

*Required

Owner signature - Mr. Horton may sign on behalf of Mr. Souki during Mr. Souki’s absence.

 

2

SCHEDULE D-1

CHANGE ORDER FORM

 

Attachment EE Adjustments (Stainless Steel, Marine Loading Arms & BOG Compressor)

 

The Agreement between the Parties listed above is changed as follows:

 

Reference:

Contract Attachment EE (Stainless Steel Adjustment, Tank Subcontract Materials Adjustment, Marine Loading Arm Adjustment and BOG Compressor Adjustment) Bechtel Letter SDN 25027-001-T05-GAM-00039 dated March 17, 2005 Bechtel Letter SDN 25027-001-T05-GAM-00062 dated April 26, 2005

Per Executed Change Order No. SP/BE-006 (signed April 26, 2005), Attachment EE Rev. l, the Contract Price is adjusted as follows:

Stainless Steel Adjustment : The Stainless Steel adjustment, which is used to account for the changes in commodity pricing of 304L stainless steel pipe, fittings and flanges as described in Section 7.ID of the Agreement, shall be determined in accordance with Section 1 of Attachment EE, Rev. 1. All calculations shall be rounded to four (4) decimal places. See attached document titled “Contract Att. EE Rev. 1 Adjustments,” dated June 16, 2005, 1 page, supporting total upward adjustment amount of $10,305,924.

Marine Loading Arm Adjustment and BOG Compressor Adjustment : The Marine Loading Arm Adjustment and BOG Compressor Adjustment, which are used to take into account currency fluctuations as described in Sections 7.1 ,F and 7.1 .G respectively, shall be determined in accordance with Section 2 of Attachment EE, Rev, 1. All calculations shall be rounded to four (4) decimal places. All currency exchange rates shall be determined using FxConverter on website http://www.oanda.com/convert/classic . See attached document titled “Contract Att. EE Rev. 1 Adjustments, “ dated June 16, 2005, 1 page, supporting total upward adjustment amount of $102,010

 

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged.

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP.

The Guaranteed Substantial Completion Date will be unchanged.

SCHEDULE D-l

CHANGE ORDER FORM

 

Attachment EE Adjustments (Stainless Steel, Marine Loading Arms & BOG Compressor)

 

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP.

Adjustment to other Changed Criteria: Not Applicable

Adjustment to Payment Schedule: See attached “Payment Milestones” 1 page, dated June 16, 2005

Adjustment to Minimum Acceptance Criteria: No Change

Adjustment to Performance Guarantees: No Change

Adjustment to Design Basis: No Change

Other adjustments to liability or obligation of Contractor or Owner under the Agreement: No Change

This Change Order shall constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and shall be deemed to compensate Contractor fully for such change.

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
				Name
				Project Manager
				Title
				6/20/05
Date of Signing				Date of Signing

SCHEDULE D-1

CHANGE ORDER FORM

 

Attachment EE Adjustments (Stainless Steel, Marine Loading Arms & BOG Compressor)

 

 

/s/ Stan Horton
* Stan Horton President & COO Cheniere Energy
Date of Signing
/s/ Keith Meyer
* Keith Meyer President Cheniere LNG
July 19, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
July 19, 2005
Date of Signing

 

*	Required Owner signature

SCHEDULE D-1

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows:

FERC Cryogenic Review

In accordance with Attachment A, Section 13.4, “Additional FERC Requirements,” Contractor was directed by Owner to incorporate FERC Cryogenic review comments imposed by FERC after June 1, 2004. Approval to incorporate comments is based on the following referenced documents previously provided to Owner:

 

•

Owner Meeting Action Items, No. 14, Issue No. 3, dated February 2, 2005

 

•

Bechtel Conference Notes 25027-001-G15-GAM-00008 dated February 7, 2005

 

•

Bechtel Conference Notes 25027-001-G-15-GAM-00009 dated February 15, 2005, Item No. 4

 

•

Bechtel Letter SDN 25027-001-T05-GAM-00031 dated March 4, 2005

Changes to Scope of Work are included in the following documents:

 

•

Trend T-008 - Cryogenic Comments, dated April 15, 2005

 

•

Owner’s response to FERC, Docket No. CPO4-47-000 “Cryogenic Information Request,” 34 pages

 

•

Lump Sum Change Order “FERC Cryogenic Comments - Detail Estimate (BECR-002) / Revised per Owner Comments” Revision 3, dated June 9, 2005, 3 pages.

 

•

“FERC Cryogenic Comments - Payment Milestones (BECR-002)” dated June 9, 2005

Detailed Reasons for Proposed Change(s) (provide detailed reasons for the proposed change, and attach all supporting documentation required under the Agreement)

Per Attachment A, Article 13.4 of the Agreement, Contractor shall commence work on any additional requirements imposed by FERC after June 1, 2004, and which are not included in the Scope of Work or the Agreement. Details of the proposed change and supporting documents are listed above.

Note: This Change Order does not address or include Changed Criteria for other additional FERC requirements under Attachment A, Article 13.4, since sufficient information is only available to address the FERC Cryogenic comments. Other outstanding potential issues will be addressed individually, as requested by Owner, and will be the subject of a separate Change Order as may be appropriate. Reference Owner letter SP-13E-C-038 dated March 31, 2005 and Contractor letter SDN-25027-001-T05-GAM-00055 dated April 12, 2005.

 

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

 

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged.

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP.

The Guaranteed Substantial Completion Date will be unchanged.

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP.

Adjustment to other Changed Criteria: None

Adjustment to Payment Schedule: See attached “FERC Cryogenic Comments—Payment Milestones,” 1 page, dated June 9, 2005.

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Performance Guarantees: None

Adjustment to Design Basis: None

Other adjustments to liability or obligation of Contractor or Owner under the Agreement: N/A

This Change Order shall constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and shall be deemed to compensate Contractor fully for such change.

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
Date of Signing				Name
/s/ Stan Horton				Project Director
*Stan Horton President & COO Cheniere Energy				Title
July 19, 2005				July 29, 2005
Date of Signing				Date of Signing

 

Rev. 2

/s/ Keith Meyer
* Keith Meyer President Cheniere LNG
July 19, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
July 19, 2005
Date of Signing

*Required Owner Signature

SCHEDULE D-l

CHANGE ORDER FORM

 

 

The Agreement between the Parties listed above is changed as follows:

Owner and Contractor agree that the Agreement shall be amended as follows:

 

1.	The following new Section 11.10 shall be added to the Agreement:

“11.10 Early Completion Bonus. Contractor shall earn an early completion bonus in the amount of Sixty-Seven Thousand U.S. Dollars (U.S.$67,000) per Day for each complete Day that Contractor achieves Early Completion prior to April 1, 2008 (the “Early Completion Date”) , up to a maximum of Six Million U.S. Dollars (U.S.$6,000,000) (the “Early Completion Bonus” ). Neither the Early Completion Date nor the Early Completion Bonus shall be subject to adjustment or extension under any circumstance, whether by Change Order or other provision of the Agreement (including an event of Force Majeure or Owner caused delay). If Contractor earns the Early Completion Bonus or any portion thereof, Contractor shall invoice Owner for the applicable amount of such Early Completion Bonus, and Owner shall pay Contractor the applicable amount of such Early Completion Bonus within the time required under this Agreement for making payments of amounts invoiced by Contractor. The failure of Contractor to earn the Early Completion Bonus shall not create a separate liability for either Owner or Contractor under this Agreement.”

 

2.	The following definitions shall be added under Section 1.1 to the Agreement:

“ Early Completion ” shall mean that all of the following have occurred with respect to the Facility: (i) Cool Down has been completed for System 1 and System 2; (ii) Contractor has completed all procurement, fabrication, assembly, erection, installation and precommissioning checks of all of the vaporizers for the Facility to ensure that all such vaporizers and each component thereof was sufficiently fabricated, assembled, erected and installed so as to be capable of being operated safely within the requirements contained in this Agreement, and thirteen vaporizers have been operated to their rated capacity; (iii) Contractor has completed all procurement, fabrication, assembly, erection, installation and pre-commissioning checks and tests of System 1 and System 2 to ensure that these Systems and each component thereof was sufficiently fabricated, assembled, erected and installed so as to be capable of being operated safely within the requirements contained in this Agreement; and (iv) System 1 and System 2, collectively, are capable of a Sendout Rate of 2,000 MMSCFD or above at a temperature of no less than 40°F and at a pressure of no less than 1,440 PSIG, as measured at the exit for the main Facility transfer meter. The status of being “capable” shall be determined by such tests or operational records as may be mutually agreed by the Parties prior to Contractor’s achievement of Early Completion.

“ Early Completion Bonus ” has the meaning set forth in Section 11.10.

“ Early Completion Date ” has the meaning set forth in Section 11.10.”

There are no other modifications to the Agreement relating to this Change Order.

 

Adjustment to Contract Price

 

Adjustment to dates in Project Schedule

The following dates are modified (list all dates modified; insert N/A if no dates modified):

The Target Bonus Date will be unchanged .

The Target Bonus Date as of the date of this Change Order therefore is 1,095 Days following NTP.

The Guaranteed Substantial Completion Date will be unchanged .

The Guaranteed Substantial Completion Date as of the date of this Change Order therefore is 1,247 Days following NTP.

Adjustment to other Changed Criteria: None

Adjustment to Payment Schedule: A separate Change Order will be required to adjust the Payment Schedule if Contractor earns the Early Completion Bonus or any portion thereof

Adjustment to Minimum Acceptance Criteria: None

Adjustment to Performance Guarantees: None

Adjustment to Design Basis: None

Other adjustments to liability or obligation of Contractor or Owner under the Agreement: N/A

This Change Order shall not constitute a full and final settlement and accord and satisfaction of all effects of the change as described in this Change Order upon the Changed Criteria and shall not be deemed to compensate Contractor fully for such change.

Upon execution of this Change Order by Owner and Contractor, the above-referenced change shall become a valid and binding part of the original Agreement without exception or qualification, unless noted in this Change Order. Except as modified by this and any previously issued Change Orders, all other terms and conditions of the Agreement shall remain in full force and effect. This Change Order is executed by each of the Parties’ duly authorized representatives.

 

/s/ Charif Souki				/s/ C. Asok Kumar
* Charif Souki Chairman				Contractor
				C. Asok Kumar
				Name
				Project Director
				Title
				July 29, 2005
Date of Signing				Date of Signing

/s/ Stan Horton
*Stan Horton President & COO Cheniere Energy
July 19, 2005
Date of Signing
/s/ Keith Meyer
*Keith Meyer President Cheniere LNG
July 19, 2005
Date of Signing
/s/ Ed Lehotsky
* Ed Lehotsky Owner Representative
July 19, 2005
Date of Signing

*Required Owner signature - Mr. Horton may sign on behalf of Mr. Souki during Mr. Souki’s absence.

 

SCHEDULE D-2

 

 

You are hereby directed to make the following additions or modifications to, or deductions from, the Work:

Implement the following P&ID and Cause & Effect Scope Option Items (refer to the attached Trend Matrix for further information) as discussed in the review meetings and subsequent correspondence:

 

Contractor shall proceed with the above design changes and prepare detailed Lump Sum cost estimates. Upon final review and approval by Owner of the detailed estimate, Contractor shall prepare the required documentation, including a completed Schedule D-3 in accordance with Article 6.1A of the Agreement.

 

Compensation for the changes specified in this Change Order is on a time and materials basis as provided in Section 6.1C and 6.2D of the Agreement.

Contractor shall commence with the performance of the change(s) described above on July 18, 2005

This Change Order is signed by Owner’s duly authorized representatives.

 

/s/ Charif Souki				/s/ Stan Horton
*Charif Souki Chairman				*Stan Horton President and COO Cheniere Energy
				July 19, 2005
Date of Signing				Date of Signing

/s/ Keit