Florida Public Service Commission native order document 02741-2023

OCR transcription for search; preserved printed pages are authoritative

FILED 4/18/2023
DOCUMENT NO. 02741-2023
FPSC - COMMISSION CLERK

BEFORE THE FLORIDA PUBLIC SERVICE COMMISSION

In re: Petition for approval of transportation DOCKET NO. 20230032-GU
service agreement with Florida Public Utilities | ORDER NO. PSC-2023-0133-PAA-GU
Company by Peninsula Pipeline Company, Inc. | ISSUED: April 18, 2023

The following Commissioners participated in the disposition of this matter:

ANDREW GILES FAY, Chairman
ART GRAHAM
GARY F. CLARK
MIKE LA ROSA
GABRIELLA PASSIDOMO

NOTICE OF PROPOSED AGENCY ACTION
ORDER APPROVING TRANSPORTATION SERVICE AGREEMENT

BY THE COMMISSION:

NOTICE is hereby given by the Florida Public Service Commission that the action
discussed herein is preliminary in nature and will become final unless a person whose interests
are substantially affected files a petition for a formal proceeding, pursuant to Rule 25-22.029,
Florida Administrative Code (F.A.C.).

Background

On March 2, 2023, Peninsula Pipeline Company, Inc. (Peninsula) filed a petition seeking
approval of a firm transportation service agreement (Transportation Agreement) between
Peninsula and Florida Public Utilities Company (FPUC) (collectively, the parties). The purpose
of the Transportation Agreement is to ensure continuance of gas service to FPUC after the
impending acquisition by Peninsula of certain pipeline facilities in the immediate area of the City
of Lake Wales in Polk County. Peninsula operates as an intrastate natural gas transmission
company as defined by Section 368.103(4), Florida Statutes (F.S).! FPUC is a local distribution
company (LDC) subject to our regulatory jurisdiction pursuant to Chapter 366, F.S.

By Order No. PSC-07-1012-TRF-GP,” Peninsula received approval of an intrastate gas
pipeline tariff that allows it to construct and operate intrastate pipeline facilities and to actively
pursue agreements with natural gas customers. Peninsula provides gas transportation service
only; it does not engage in the sale of natural gas. Pursuant to Order No. PSC-07-1012-TRF-GP,
Peninsula is allowed to enter into certain gas transmission agreements without our prior

' Order No. PSC-06-0023-DS-GP, issued January 9, 2006, in Docket No. 050584-GP, Jn re: Petition for declaratory
statement by Peninsula Pipeline Company, Inc. concerning recognition as a natural gas transmission company
under Section 368.101, F.S., et seq.

> Order No. PSC-07-1012-TRF-GP, issued December 21, 2007, in Docket No. 070570-GP, Jn re: Petition for
approval of natural gas transmission pipeline tariff by Peninsula Pipeline Company, Inc.

ORDER NO. PSC-2023-0133-PAA-GU
DOCKET NO. 20230032-GU
PAGE 2
- 2 -
approval.3 However, Peninsula is requesting our approval of this proposed Transportation
Agreement as it does not fit any of the criteria enumerated in the tariff for which our approval
would not be required.4 The parties are subsidiaries of Chesapeake Utility Corporation, a
Delaware corporation, and agreements between affiliated companies must be approved by us
pursuant to Section 368.105, F.S., and Order No. PSC-07-1012-TRF-GP.
In 1999, we approved a pipeline lease agreement (1999 agreement) between FPUC
(Florida Division of Chesapeake Utilities Corporation at the time) and Citrosuco North America,
Inc. (Citrosuco) for pipeline facilities in the Lake Wales area.5 Citrosuco owns and operates a
citrus processing plant in Lake Wales. In 1999, Citrosuco constructed a natural gas pipeline that
provides access for the Citrosuco processing plant to the Florida Gas Transmission (FGT)
interstate natural gas pipeline. The Citrosuco-owned pipeline runs from the FGT Lake Wales
gate station to Citrosuco’s meter at the entrance of its citrus processing plant.
Pursuant to the 1999 agreement, Citrosuco owns the pipeline and leases it to FPUC for
operation and maintenance. FPUC receives certain quantities of natural gas at the Lake Wales
Gate Station for Citrosuco’s use and transports the natural gas on the pipeline to Citrosuco’s
facility. In addition, FPUC accesses the pipeline to serve customers in the Lake Wales area. The
1999 agreement expired in 2019 and has been renewed on a monthly basis.
Peninsula has been in discussions with Citrosuco to acquire the pipeline from Citrosuco
through a Pipeline Purchase and Sale Agreement. This purchase agreement between Peninsula
and Citrosuco, which contains a negotiated purchase price, does not require our approval. Upon
acquisition, Peninsula would maintain and operate the pipeline and provide transportation service
to FPUC pursuant to the proposed Transportation Agreement. Citrosuco would continue to
receive natural gas service from the pipeline. Peninsula stated that the closing of the purchase
agreement is contingent on our approval of the proposed Transportation Agreement.
The proposed Transportation Agreement and project map are shown as Attachments A
and B to this order. Pursuant to the Transportation Agreement, FPUC will continue to utilize the
Citrosuco pipeline system to serve its customers in and around Lake Wales, Florida. On March
8, 2023, our staff had an informal conference call with Peninsula and FPUC regarding the
petition. During the evaluation of the petition, staff issued a data request to the parties for which
responses were received on March 13, 2023.6 Peninsula requested expedited approval of the
proposed Transportation Agreement and that we consider it at our April 4, 2023 Agenda
Conference. We have jurisdiction over this matter pursuant to Sections 366.05(1), 366.06, and
368.105, F.S.
3 Peninsula Pipeline Company, Inc., Intrastate Pipeline Tariff, Original Vol. 1, Original Sheet No. 11, Section 3.
4 Peninsula Pipeline Company, Inc., Intrastate Pipeline Tariff, Original Vol. 1, Original Sheet No. 12, Section 4.
5 Order No. PSC-99-2106-PAA-GU, issued October 25, 1999, in Docket No. 991168-GU, In re: Petition by the
Florida Division of Chesapeake Utilities Corporation for approval of CTS Gas Transportation Service Agreement
with Citrosuco North America, Inc.
6 Document No. 02200-2023.

ORDER NO. PSC-2023-0133-PAA-GU
DOCKET NO. 20230032-GU
PAGE 3
- 3 -
Decision
Proposed Transportation Service Agreement
The parties have entered into the proposed firm Transportation Agreement to enable
FPUC to continue to serve natural gas customers in and around the area of Lake Wales once
Peninsula has acquired the Citrosuco pipeline system.
The proposed Transportation Agreement specifies an initial term of 20 years and
thereafter shall be extended on a year-to-year basis, unless either party gives no less than 90 days
of written notification of termination. If either party desires to negotiate modifications to the
rates or terms of this Transportation Agreement, they may do so no less than 120 days prior to
expiration of the current active term. The proposed Citrosuco pipeline acquisition is discussed
below and the project map depicting the pipeline is Attachment B to this order.
Citrosuco Pipeline Acquisition
The Citrosuco pipeline consists of approximately 11 miles of 8-inch steel pipeline and
associated facilities. The pipeline runs from the FGT Lake Wales gate station to Citrosuco’s
meter at the entrance of its citrus processing plant.
In the petition, Peninsula stated that it has negotiated an acquisition agreement with
Citrosuco for the Citrosuco pipeline system and that the closing of the pipeline acquisition
agreement is contingent on our approval of the proposed Transportation Agreement. If the
proposed 	Transportation 	Agreement 	is 	approved, 	Peninsula 	stated 	that 	it 	will 	take 	over
ownership of the pipeline, as well as operation and maintenance of the facilities from FPUC.
Peninsula will provide service to FPUC pursuant to the proposed Transportation Agreement. In
response to staff’s data request, the parties explained that the Citrosuco pipeline falls within the
portfolio of projects typically operated by Peninsula, instead of FPUC.
The parties stated that after the closing of the acquisition, FPUC will serve Citrosuco for
six years pursuant to the Commission-approved Contract Transportation Service Rider which
allows FPUC to provide reduced rates to commercial or industrial customers with alternate fuel
capabilities. Afterwards, FPUC asserts that Citrosuco would be served under a standard rate
schedule.
Anticipated System Benefits
The parties assert that the proposed Transportation Agreement will enable FPUC to
continue to obtain gas supply from FGT upon Peninsula’s acquisition of the Citrosuco pipeline.
In response to staff’s first data request, FPUC stated that it believes there is too much risk
involved in leasing key facilities from an unrelated entity such as Citrosuco.7 FPUC believes that
Peninsula’s ownership of the pipeline will protect the general body of ratepayers from potential
unforeseen price increases or service challenges tied to a leasing arrangement. FPUC stated that
the Citrosuco pipeline is a key strategic asset for FPUC’s gas supply and operations in the City
of Lake Wales. Additionally, FPUC stated that it anticipates growth in the immediate area of the
7 Document No. 02200-2023.

ORDER NO. PSC-2023-0133-PAA-GU
DOCKET NO. 20230032-GU
PAGE 4
- 4 -
pipeline, and that Peninsula owning the pipeline would position FPUC to meet the anticipated
growth.
Furthermore, 	the 	parties 	asserted 	that 	purchasing 	the 	existing 	pipeline 	through 	a
negotiated purchase price would be less costly than installing a new, separate pipeline to serve
FPUC’s customers. FPUC estimated that it would cost approximately $15.46 million to build
another, similar feed to its Lake Wales system. By instead acquiring the existing pipeline from
Citrosuco, Peninsula would be avoiding additional costs, therefore reducing the total cost to be
recovered from FPUC’s general body of ratepayers.
Negotiated Monthly Reservation Payments to Peninsula
The parties assert that the negotiated monthly reservation charge contained in the
proposed Transportation Agreement is consistent with market rates, because the rates are
substantially 	the 	same 	as 	rates 	set 	forth 	in 	similar 	agreements 	as 	required 	by 	Section
368.105(3)(b), F.S. The parties assert that Peninsula will recover the purchase price of the
pipeline from Citrosuco through the monthly reservation charge (confidential) to FPUC as shown
in Exhibit A to the proposed Transportation Agreement.
FPUC is proposing to recover its payments to Peninsula through Purchased Gas
Adjustment (PGA) and swing service rider mechanisms. The PGA allows FPUC to periodically
adjust the price of natural gas supplied to its customers to reflect the actual cost of gas purchased
and delivered on behalf of the customers. The swing service rider allows FPUC to recover
intrastate capacity costs from their transportation customers and is a cents per therm charge that
is included in the monthly customer gas bill of transportation customers.
Conclusion
Based on the petition and the parties’ responses to our staff’s data request, we find that
the proposed Transportation Agreement is reasonable and meets requirements of Section
368.105, F.S. Furthermore, the proposed Transportation Agreement benefits FPUC’s current and
potential future customers by ensuring that there is a continuous supply of natural gas to the City
of Lake Wales. Therefore, we approve the proposed Transportation Agreement between
Peninsula and FPUC dated March 1, 2023.
Based on the foregoing, it is
ORDERED 	by 	the 	Florida 	Public 	Service 	Commission 	that 	the 	proposed 	firm
transportation service agreement dated March 1, 2023 between Florida Public Utilities Company
and Peninsula Pipeline Company, Inc., is approved. The proposed Transportation Agreement is
reasonable and meets the requirements of Section 368.105, F.S. Furthermore, the proposed
Transportation Agreement benefits FPUC’s current and potential future customers by ensuring
that there is an uninterrupted supply of natural gas to Lake Wales, Florida. It is further
ORDERED that the provisions of this Order, issued as proposed agency action, shall
become final and effective upon the issuance of a Consummating Order unless an appropriate
petition, in the form provided by Rule 28-106.201, Florida Administrative Code, is received by
the Commission Clerk, 2540 Shumard Oak Boulevard, Tallahassee, Florida 32399-0850, by the

ORDER NO. P SC -20 23 -01 33- PA A-GU
DOC KET NO. 20230032-GU
PAGES
close of bu siness on the date set forth in the "No ti ce of Further Proceedi ngs" attached hereto. It
is fu11her
MRT
ORDERED that in th e eve nt thi s Order becomes fin al, t hi s docket shal l be close d.
By ORDER of th e Flo rida Public Service ~ 	ion thir.-~-----
ADAM J. T ·
Co mmi ss ion
Florida Publ ic Service Commission
2540 Shumard Oak Boulevard
Ta ll ahassee, Florida 32399
(850) 413-6770
www.flor id apsc.com
Cop ies furnished: 	A copy of this document is
prov id ed to th e parties of record at the time of
issuance a nd , if applica bl e, interested persons.
- 5 -

ORDER NO. PSC-2023-0133-PAA-GU
DOCKET NO. 20230032-GU
PAGE 6
- 6 -
NOTICE OF FURTHER PROCEEDINGS OR JUDICIAL REVIEW
The Florida Public Service Commission is required by Section 120.569(1), Florida
Statutes, to notify parties of any administrative hearing that is available under Section 120.57,
Florida Statutes, as well as the procedures and time limits that apply. This notice should not be
construed to mean all requests for an administrative hearing will be granted or result in the relief
sought.
Mediation may be available on a case-by-case basis. 	If mediation is conducted, it does
not affect a substantially interested person's right to a hearing.
The action proposed herein is preliminary in nature. Any person whose substantial
interests are affected by the action proposed by this order may file a petition for a formal
proceeding, in the form provided by Rule 28-106.201, Florida Administrative Code. 	This
petition must be received by the Office of Commission Clerk, 2540 Shumard Oak Boulevard,
Tallahassee, Florida 32399-0850, by the close of business on May 9, 2023.
In the absence of such a petition, this order shall become final and effective upon the
issuance of a Consummating Order.
Any objection or protest filed in this/these docket(s) before the issuance date of this order
is considered abandoned unless it satisfies the foregoing conditions and is renewed within the
specified protest period.

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page | of 10
PAGE 7

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE AGREEMENT

THIS AGREEMENT entered into this 28 day of February, 2023, by and between
Peninsula Pipeline Company, Inc., a corporation of the State af Delaware {herein called
"Company" or “PPC”)}, and Florida Public Utilities Company, a corporation of the State of
Florida (herein called "Shipper" or “FPUC”). PPC and FPUC are sometimes referred to herein
individually as “Party” and collectively as “Parties.”

WITNESSETH

WHEREAS, Company is engaged in discussions to acquire a pipeline system from
Citrosuco North America, Inc. (“Cittosuco”) in Lake Wales, Florida which extends from start point at
the Florida Gas Transmission (“FGT”) Lake Wales gate station to Citosuco’s meter at the front
entrance of its citrus processing plant (“Citrosuco Pipeline System”); and

WHEREAS, FPUC currently utilizes said Citrasuco Pipeline System ta serve FPUC
distribution customers in the area under a separate agreement with Citrosuco that is currently
month-to-nonth; and

WHEREAS, Company intends to execute a Pipeline Purchase and Sale Agreement
with Citrosuca North America, Inc., a Delaware corporation (“Purchase and Sale
Agreement”) to acquire and operate the Citrosuco Pipeline System; and

WHEREAS, Shipper desires to obtain Firm Transportation Service (" FTS") from
Company in the event Company acquires the Citrosuco Pipeline System; and

WHEREAS, Company desires to provide Firm Transportation Service ta Shipper in
accordance with the terms hereof;

NOW THEREFORE, in consideration of the premises and of the mutual cavenants
and agreements herein contained, the sufficiency of which is hereby acknowledged,
Company and Shipper do covenant and agree as follows:

ARTICLE I
BEFINITION

Unless otherwise defined in this Apreement, all definitions for terms used herein have
the sare meaning as provided in Company's Tariff.

ARTICLE II
QUANTITY & UNAUTHORIZED USE

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 2 of 10
PAGE 8

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE
2.1 The Maximum Daily Transportation Quantity ("MDTQ") and the Maximum
Hourly Transportation Percentage ("MHTP”) shall be set forth on Exhibit A attached hereto.
The applicable MDTQ shall be the largest daily quantity of Gas, expressed in Dekatherms,
which Company is obligated to transport on a firm basis and make available for delivery for
the account of Shipper under this Agreement on any one Gas Day.

2.2 If, on any Day, Shipper utilizes transportation quantities, as measured at the
Point(s} of Delivery, in excess of the established MDTQ, as shown on Exhibit A, such
unauthorized use of transportation quantities (per Dekatherm) shall be billed at a rate of 2.0
times the rate to be charged for each Dekatherm of the MDTQ as set forth on Exhibit A of
this Agreement.

ARTICLE III
FIRM TRANSPORTATION SERVICE RESERVATION CHARGE

31 The Monthly Reservation Charge for Firm Transportation Service provided
under this Agreement shall be as set forth on Exhibit A of this Agreement and shall be
assessed in accordance with the terms and conditions set forth herein as of the Effective Date
(as defined in Section 4.1 below).

3.2 The parties agree to execute and file with the Commission a petition for approval of this
Agreement within thirty (30) days of execution by both parties.

33 If, at any time after the Execution Date (as defined in Section 9.3 hereof}
and throughout the term of this Agreement, the Company is required by any Governmental
Authority (as that term is defined in Section 9.10) asserting jurisdiction over this Agreement
and the transportation of Gas hereunder, to incur additional tax charges (including, without
limitation, income taxes and property taxes} with regard to the service provided by Company
under this Agreement, then Shipper’s Monthly Reservation Charge shall be adjusted and
Exhibit A updated accordingly, and the new Monthly Reservation Charge shall be
implemented immediately upon the effective date of such action. If Shipper does not agree
to the adjusted Monthly Reservation Charge, Company shall no longer be required to
continue to provide the service contemplated in this Agreement should an action of a
Governmental Authority result in a situation where Company otherwise would be required to
provide transportation service at rates that are not just and reasonable, and in such event the
Company shall have the right to terminate this Agreement pursuant to the conditions set
forth in Section D of the Rules and Regulations of Company’s Tariff.

3.4 If, at any time after the Execution Date and throughout the term of this
Agreement, the Company is required by any Governmental Authority asserting jurisdiction over
this Agreement and the transportation of Gas hereunder, to incur additional capital expenditures
with regard to the service provided by Company under this Agreement, other than any capital
expenditures required to provide transportation services to any other customer on the pipeline
system serving Shipper’s facility, but including, without limitation, mandated relocations of
Company’s pipeline facilities serving Shipper’s facility and costs to comply with any changes in
pipeline safety regulations, then Shipper’s Monthly Reservation Charge shall be adjusted and
Exhibit A updated accordingly, and the new Monthly Reservation Charge shall be implemented

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 3 of 10
PAGE 9

PENINSULA PIPELINE COMPANY, INC.

FIRM TRANSPORTATION SERVICE
immediately upon the effective date of such action. If Shipper does not agree to the adjusted
Monthly Reservation Charge, Company shall no longer be required to continue to provide the
service contemplated in this Agreement should an action of a Governmental Authority result in a
situation where Company otherwise would be required to provide transportation service at rates
that are not just and reasonable, and in such event the Company shall have the right to terminate
this Agreement pursuant to the conditions set forth in Section D of the Rules and Regulations of
Company’s Tariff.

ARTICLE IV
TERM AND TERMINATION

41 Subject to all other provisions, conditions, and limitations hereof, the term of
this Agreement for purposes of performance by the Parties shall commence on the date of
execution of the Purchase and Sale Agreement ("Effective Date") and shall continue in full
force and effect for an initial period of twenty (20) years from the Effective Date (‘Initial
Term"). Thereafter, the Agreement shall be extended on a year-to-year basis ("Renewed
Term"), unless either Party gives written notice of termination to the other Party, not less
than (90) days prior to the expiration of the Initial Term or Renewed Termed (jointly,
“Current Term”). This Agreement may only be terminated earlier in accordance with the
provisions of this Agreement and the Parties' respective rights under applicable law or in the
event Company does not close on the Citrosuco Pipeline System or by September 1, 2023, in
which case this Agreement shall terminate automatically.

42 No less than 120 days before expiration of the Current Term, either Party
may request the opportunity to negotiate a modification of the rates or terms of this
Agreement to be effective with the subsequent Renewed Term. Neither Party is obligated to,
but may, agree to any mutually acceptable modification to the Agreement for the subsequent
Renewed Term. In the event the Parties reach agreement for a modification to the Agreement
for the subsequent Renewed Term, such agreed upon modification ("Agreement
Modification”) shall be set forth in writing and signed by both Parties prior to the expiration of
the Current Term.

4.3 Any portion of this Agreement necessary to resolve monthly balancing and
operational controls under this Agreement, pursuant to the Rules and Regulations of
Company's Tariff, shall survive the other parts of this Agreement until such time as such
monthly balancing and operational controls have been resolved.

44 In the event Shipper fails to pay for the service provided under this
Agreement, otherwise fails to meet Company's standards for creditworthiness set forth in
Section C of the Rules and Regulations of the Company’s Tariff, otherwise violates the
Rules and Regulations of Company's Tariff, or defaults on this Agreement, Company shall
have the right to terminate this Agreement pursuant to the conditions set forth in Section D
of the Rules and Regulations of Company's Tariff.

ARTICLE V
COMPANY'S TARIFF PROVISIONS

5.1 Company's Tariff approved by the Commission, including any amendments

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 4 of 10
PAGE 10

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE
thereto approved by the Commission during the term of this Agreement (“Company’s
Tariff”), is hereby incorporated into this Agreement and made a part hereof for all
purposes. In the event of any conflict between Company's Tariff and the specific
provisions of this Agreement, the latter shall prevail, in the absence of a Commission
Order to the contrary.

ARTICLE VI
REGULATORY AUTHORIZATIONS AND APPROVALS

6.1 As of the Effective Date of this Agreement, Company's obligation to provide
service is conditioned upon receipt and acceptance of any necessary regulatory
authorization to provide Firm Transportation Service for Shipper in accordance with the
Rules and Regulations of Company's Tariff.

ARTICLE VII
DELIVERY POINT (S) AND POINT(S) OF DELIVERY

71 The Delivery Point(s) for all Gas delivered for the account of Shipper
into Company's pipeline system under this Agreement, shall be as set forth on Exhibit A
attached hereto.

7.2 The Point(s) of Delivery shall be as set forth on Exhibit A attached hereto.

73 Shipper shall cause Transporter to deliver to Company at the Delivery
Point(s) on the Transporter’s system, the quantities of Gas to be transported by Company
hereunder. Company shall have no obligation for transportation of Shipper’s Gas prior
to receipt of such Gas from the Transporter at the Delivery Point(s), nor shall Company
have any obligation ta obtain capacity on Transporter for Shipper or on Shipper’s
behalf. The Company shall deliver such quantities of Gas received from the Transporter
at the Delivery Point(s) for Shipper's account to Company's Point(s) of Delivery
identified on Exhibit A.

ARTICLE VIII
SCHEDULING AND BALANCING

8.1 Shipper shall be: responsible for nominating quantities of Gas ta be
delivered by the Transporter to the Delivery Point(s) and delivered by Company to the
Point(s) of Delivery. Shipper shall promptly provide notice to Company of all such
nominations. Imbalances between quantities (i) scheduled at the Delivery Point(s) and
the Point(s) of Delivery, and (ii) actually delivered by the Transporter and/or Company
hereunder, shall be resalved in accordance with the applicable provisions of Company's
Tariff, as such provisions, and any amendments to such provisions, are approved by the
Commission.

8.2 The parties hereto recognize the desirability of maintaining a uniform rate

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 5 of 10
PAGE 11

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE

of flow of Gas to Shipper’s facilities over each Gas Day throughout each Gas Month.
Therefore, Company agrees to receive from the Transporter for Shipper's account at the
Delivery Point(s) and deliver to the Point(s) of Delivery up to the MDTQ as described in
Exhibit A, subject to any restrictions imposed by the Transporter and to the provisions of
Article IX of this Agreement, and Shipper agrees to use reasonable efforts to regulate its
deliveries from Company's pipeline system at a daily rate of flow not to exceed the
applicable MDTQ for the Gas Month in question, subject to any additional restrictions
imposed by the Transporter or by Company pursuant to Company's Tariff.

ARTICLE IX
MISCELLANEOUS PROVISIONS

9.1 Notices and Other Communications. Any notice, request, demand,
statement, or payment provided for in this Agreement, unless otherwise specified, shall be
sent to the parties hereto at the following addresses:

Company: Peninsula Pipeline Company, Inc.
500 Energy Lane, Suite 200
Dover, Delaware 19901
Attention: Contracts

Shipper: Florida Public Utilities Company
208 Wildlight Avenue
Yulee, Florida 32097
Attention: Contracts

G2 Headings. All article headings, section headings and subheadings in this
Agreement are inserted only for the convenience of the Parties in identification of the
provisions hereof and shall not affect any construction or interpretation of this Agreement.

9.3 Entire Agreement. This Agreement, including the Exhibit attached hereto,
sets forth the full and complete understanding of the Parties as of the date of its execution by
both parties (the “Execution Date”), and it supersedes any and all prior negotiations,
agreements and understandings with respect to the subject matter hereof. No Party shall be
bound by any other obligations, conditions, or representations with respect to the subject
matter of this Agreement.

9.4 Amendments. Neither this Agreement nor any of the terms hereof may be
terminated, amended, supplemented, waived or modified except by an instrument in writing
signed by the Party against which enforcement of the termination, amendment, supplement,
waiver or modification shall be sought. A change in (a) the place to which notices pursuant
to this Agreement must be sent or (b) the individual designated as the Contact Person
pursuant to Section 9.1 shall not be deemed nor require an amendment of this Agreement
provided such change is communicated in accordance with Section 9.1 of this Agreement.
Further, the Parties expressly acknowledge that the limitations on amendments to this

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 6 of 10
PAGE 12

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE
Agreement set forth in this section shall not apply to or otherwise limit the effectiveness of
amendments that are or may be necessary to comply with the requirements of, or are
otherwise approved by, the Commission or its successor agency or authority.

9.5 Severability. If any provision of this Agreement becomes or is declared by a
court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall
continue in full force and effect without said provision; provided, however, that if such
severability materially changes the economic benefits of this Agreement to either Party, the
Parties shall negotiate in good faith an equitable adjustment in the provisions of this
Agreement.

9.6 Waiver. No waiver of any of the provisions of this Agreement shall be
deemed to be, nor shall it constitute, a waiver of any other provision whether similar or not.
No single waiver shall constitute a continuing waiver, unless otherwise specifically identified
as such in writing. No waiver shall be binding unless executed in writing by the Party
making the waiver.

9.7 Attorneys' Fees and Costs. In the event of any litigation between the Parties
arising out of or relating to this Agreement, the prevailing Party shall be entitled to recover
all costs incurred and reasonable attorneys’ fees, including attorneys’ fees in all investigations,
trials, bankruptcies, and appeals.

9.8 Independent Parties. Company and Shipper shall perform hereunder as
independent parties. Neither Company nor Shipper is in any way or for any purpose, by
virtue of this Agreement, a partner, joint venturer, agent, employer or employee of the other.
Nothing in this Agreement shall be for the benefit of any third person for any purpose,
including, without limitation, the establishing of any type of duty, standard of care or
liability with respect to any third person.

5.9 Assignment and Transfer, No assignment of this Agreement by either Party
may be made without the prior written approval of the other Party (which approval shall not
be unreasonably withheld) and unless the assigning or transferring Party's assignee or
transferee shall expressly assume, in writing, the duties and obligations under this Agreement
of the assigning or transferring Party. Upon such assignment or transfer, as well as
assumption of the duties and obligations, the assigning or transferring Party shall furnish or
cause to be furnished to the other Party a true and correct copy of such assignment or
transfer and the assumption of duties and obligations.

9.10 Governmental Authorizations; Compliance with Law. This Agreement shall
be subject to all valid applicable state, local and federal laws, orders, directives, rules and
regulations of any governmental body, agency or official having jurisdiction over this
Agreement and the transportation of Gas hereunder. Company and Shipper shall comply at
all times with all applicable federal, state, municipal, and other laws, ordinances and
regulations. Company and/or Shipper will furnish any information or execute any documents
required by any duly constituted federal or state regulatory authority in connection
with the performance of this Agreement. Each Party shall proceed with diligence to file any

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 7 of 10
PAGE 13

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE

necessary applications with any governmental authorities for any authorizations necessary to
cairy out its obligations under this Agreement. In the event this Agreement or any provisions
herein shall be found contrary to or in conflict with any applicable law, order, directive, rule
or regulation, the latter shall be deemed to control, but nothing in this Agreement shall
prevent either Party from contesting the validity of any such law, order, directive, rule, or
regulation, nor shall anything in this Agreement be construed to require either Party to waive
its respective rights to assert the lack of jurisdiction of any governmental agency other than
the Commission, over this Agreement or any part thereof. In the event of such contestation,
and unless otherwise prohibited from doing so under this Section 9.10, Company shall
continue to transport and Shipper shall continue to take Gas pursuant to the terms of this
Agreement. In the event any law, order, directive, rule, or regulation shall prevent either
Party from performing hereunder, then neither Party shall have any obligation to the other
during the period that performance under the Agreement is precluded. If, however, any
Governmental Authority's modification to this Agreement or any other order issued, action
taken, interpretation rendered, or rule implemented, will have a material adverse effect on
the rights and obligations of the Parties, including, but not limited to, the relative economic
position of, and risks to, the Parties as reflected in this Agreement, then, subject to the
provisions of Sections 3.3 and 3.4 of this Agreement, the Parties shall use reasonable efforts
to agree upon replacement terms that are consistent with the relevant order or directive, and
that maintain the relative economic position of, and risks to, the Parties as reflected in this
Agreement as of the Execution Date. As used herein, "Governmental Authority” shall mean
any United States federal, state, local, municipal or other government; any governmental,
regulatory or administrative agency, cowt, commission or other authority lawfully
exercising or entitled to exercise any administrative, executive, judicial, legislative, police,
regulatory or taxing authority or power; and any court or governmental tribunal.

(i) If any Governmental Authority asserting jurisdiction over the pipeline facility
contemplated in this Agreement, issues an order, ruling, decision or regulation
not covered by Section 3.3 or 34 of this Agreement (including denial of necessary
permits or amendments to existing permits) related to the operation,
maintenance, location, or safety and integrity compliance, including any new
or revised enforceable regulatory classification of the pipeline facility, as
applicable, which is not reasonably foreseeable as of the Execution Date and
which results in a materially adverse effect on either Party's rights and
benefits under this Agreement, each Party shall use commercially reasonable
efforts and shall cooperate with the other Party to pursue all necessary
permits, approvals and authorizations, if any, of such applicable
Governmental Authority, and to amend the terms and conditions of this
Agreement, in each case as may be reasonably required in order that
provision of firm transportation service under this Agreement shall continue;
provided that neither Party shall be required to take any action pursuant to
this Section which is reasonably likely to have a materially adverse effect on
such Party’s rights and benefits under this Agreement.

(ii) Ifthe Parties are unable or unwilling to reach agreement pursuant to this
Section 9.10, Company shall have the right to terminate this Agreement,
without any further obligations to Shipper, upon one hundred twenty (120)

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 8 of 10
PAGE 14

PENINSULA PIPELINE COMPANY, INC,
FIRM TRANSPORTATION SERVICE
days prior written notice to Shipper.

9.11 Applicable Law and Venue. This Agreement and any dispute arising
hereunder shall be governed by and interpreted in accordance with the laws of the State of
Florida. The venue for any action, at law or in equity, commenced by either Party against the
other and arising out of or in connection with this Agreement shall

be in a court of the State of Florida having jurisdiction.

9.12 Counterparts. This Agreement may be executed in counterparts, all of which
taken together shall constitute one and the same instrument and each of which shall be
deemed an original instrument as against any Party who has signed it.

ORDER NO. PSC-2023-0133-PAA-GU Attachment A
DOCKET NO. 20230032-GU Page 9 of 10
PAGE 15

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE

IN WITNESS WHEREOBF, the parties hereto have caused this Agreement ta
be executed by their duly authorized officers or representatives.

COMPANY SHIPPER
Peninsula Pipeline Company, Inc, Florida Public Utilities Company
py! Laniaca xitipa- Bx Cite Hancock
Marissa Stipa Bill Hancock
Tide: Director Title: Assistant Vice President
DateMarch 1 2023 DateMarch 1 2023

(To be attested by the corporate secretary if not signed by an officer of the company)

By: By:
Title: Title:
Date: Date:

ORDER NO. PSC-2023-0133-PAA-GU
DOCKET NO. 20230032-GU
PAGE 16

PENINSULA PIPELINE COMPANY, INC.
FIRM TRANSPORTATION SERVICE

EXHIBIT A

Attachment A
Page 10 of 10

FIRM TRANSPORTATION SERVICE AGREEMENT BETWEEN

PENINSULA PIPELINE COMPANY, INC.
AND

FLORIDA PUBLIC UTILITIES COMPANY

Description of Description of

‘Transporter Point(s) of Delivery
Delivery Point(s)

Florida Gas Various delivery
Transmission- Lake points terminating at
Wales pate station or near Highway 60

and Dude Ranch

Road

Total MDTQ (Dekatherms):; GD t/Day

MHTP: qs

Monthly Reservation Charge: GD) GRD ckatherm/day).

subject to adjustment pursuant to the terms of this Agreement.

11

This charge is

ORDER NO. PSC-2023-0133-PAA-GU Attachment B
DOCKET NO. 20230032-GU Page | of 1
PAGE 17

o o42s i . ¥ “17 Mies

Legend
—— Citrosuco Pipeline
Existing Pipeline

Citrosuco

Lae