Title
RESOLUTION AUTHORIZING ASSET MANAGEMENT AGREEMENT WITH UNITED ENERGY TRADING LLC FOR THE MANAGEMENT OF THE CITY'S GAS SUPPLY, TRANSPORTATION, STORAGE AND DELIVERY CONTRACTS.
Body
CITY PROPOSAL:
RESOLVED, that the proper city officials are hereby authorized to enter into an agreement, substantially in the form of that attached hereto as Exhibit A, with United Energy Trading LLC for the management of the city's contracts for the purchase, transportation, storage and delivery of natural gas to the city's distribution system and for the sale of excess capacity under those contracts with all resulting income to be payable to Fund 520-500-1900-4805 (Gas Fund, Public Works and Utilities, Public Works Directors Office, Reimbursements
Statement of Purpose
STATEMENT OF PURPOSE: The purpose of this resolution is to authorize the city to enter into an agreement with United Energy Trading LLC ("UET") pursuant to which the city will turn over management of the city's contracts for the purchase, transportation and storage of natural gas required by the city's gas utility and its customers and for the delivery of gas needed by the city to the city's distribution system and the sale of unneeded capacity on the open market.
The city has historically determined that the most economical way to provide natural gas to its customers is to purchase it from suppliers located at or near the points of production and then to contract for its transportation by pipeline to the "City gates" where it enters the city's own distribution system. Also, because of the cyclical nature of the city's demand for gas, caused by weather and varying uses by its customers, the city also needs to store gas during periods of lower usage in order to have it available when demand peaks. This storage is accomplished by renting underground storage capacity, much of which is located in the south-central part of the country.
In addition, because the city's actual needs for gas are difficult to pre...
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