Gas Purchase Agreement for the United States

Gas Purchase Agreement Template for United States

A Gas Purchase Agreement is a legally binding contract used in the United States that establishes terms and conditions for the sale and purchase of natural gas. The agreement typically covers quantity, quality, pricing, delivery points, and operational requirements while complying with federal and state regulations, including FERC requirements and state utility commission rules. It includes provisions for nomination procedures, measurement, billing, and dispute resolution, all within the framework of U.S. energy laws and regulations.

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What is a Gas Purchase Agreement?

Gas Purchase Agreements are essential instruments in the U.S. energy sector, used to formalize the commercial relationship between gas sellers and buyers. These agreements are particularly important given the complex regulatory environment governing natural gas transactions in the United States, including FERC oversight and state-specific requirements. A Gas Purchase Agreement typically addresses both commercial and operational aspects of gas sales, including firm or interruptible supply obligations, pricing mechanisms, quality specifications, and delivery arrangements. The agreement should be structured to comply with both federal and state regulations while providing clear rights and obligations for all parties involved.

What sections should be included in a Gas Purchase Agreement?

1. Parties: Identification of buyer and seller with full legal details

2. Background: Context of the agreement and basic transaction structure

3. Definitions: Key terms used throughout the agreement including regulatory references

4. Gas Quantity: Specified volumes, delivery obligations, and nomination procedures

5. Price and Payment: Pricing mechanism, payment terms, and invoicing requirements

6. Delivery Point: Specified location for gas transfer and title passage

7. Quality Specifications: Required gas quality standards and measurement procedures

8. Term and Termination: Duration of agreement and termination rights

9. Representations and Warranties: Standard and specific warranties regarding capacity and authority

10. Governing Law and Jurisdiction: Applicable law and dispute resolution procedures

What sections are optional to include in a Gas Purchase Agreement?

1. Take-or-Pay Provisions: Minimum purchase obligations and payment requirements for undelivered quantities

2. Transportation: Pipeline arrangements and responsibilities for gas transportation

3. Force Majeure: Events excusing performance and notification requirements

4. Credit Support: Requirements for financial security or guarantees

5. Regulatory Compliance: Specific provisions addressing compliance with federal and state regulations

What schedules should be included in a Gas Purchase Agreement?

1. Schedule A - Delivery Point Specifications: Technical details of delivery locations and facilities

2. Schedule B - Quality Specifications: Detailed gas quality requirements and testing procedures

3. Schedule C - Pricing Formula: Detailed pricing calculations and adjustment mechanisms

4. Schedule D - Nomination Procedures: Detailed procedures for gas nominations and scheduling

5. Schedule E - Form of Performance Security: Template for any required security instruments or guarantees

6. Schedule F - Measurement and Testing: Detailed procedures for gas measurement and quality testing

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

United States

Publisher

Genie AI

Document Type

Sale Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Industries

Natural Gas Act (NGA): Federal legislation that regulates the interstate transportation and sale of natural gas, requiring certificates of public convenience and necessity for gas companies

Natural Gas Policy Act (NGPA): Federal law that established a comprehensive price structure for natural gas sales and provides framework for the gradual deregulation of natural gas prices

FERC Regulations: Federal Energy Regulatory Commission rules governing interstate natural gas pipelines, storage, and trading

Energy Policy Act: Comprehensive energy legislation addressing energy production, including natural gas policy, infrastructure, and security

Pipeline Safety Act: Federal legislation establishing safety standards for natural gas pipelines and transportation

Clean Air Act: Environmental legislation that regulates air emissions from stationary and mobile sources, affecting natural gas operations

EPA Regulations: Environmental Protection Agency rules governing environmental impacts of natural gas operations, including emissions and waste management

NEPA: National Environmental Policy Act requiring environmental impact assessments for major federal actions affecting the environment

State Public Utility Commission Regulations: State-specific rules governing utility operations, pricing, and service requirements for natural gas distribution

Uniform Commercial Code (UCC): Particularly Article 2 on Sales, governing commercial transactions including natural gas sales contracts

DOT Regulations: Department of Transportation rules governing the safe transportation of natural gas through pipeline systems

PHMSA Requirements: Pipeline and Hazardous Materials Safety Administration standards for pipeline safety and hazardous materials transport

RTO/ISO Rules: Regional Transmission Organization and Independent System Operator requirements for natural gas market participation and scheduling

Export Regulations: Department of Energy and other federal requirements governing the export of natural gas from the United States

USMCA Provisions: United States-Mexico-Canada Agreement provisions affecting cross-border natural gas trade and investment

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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