BRAE-FORTIES PIPELINE SYSTEM PIPELINE LIQUIDS ... · Brae-Forties PLTA Section 1 August 2012...

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BRAE-FORTIES PIPELINE SYSTEM PIPELINE LIQUIDS TRANSPORTATION AGREEMENT SECTION 1 FORM OF AGREEMENT This document illustrates the structure of the section of the agreement which will contain field- specific terms for transportation of pipeline liquids in the Brae-Forties Pipeline System (Section 1). All text shown in blue and italics is explanatory material. Sample articles in Section 1 are also set out for illustration purposes only; the majority will be tailored to the Shippers’ Field requirements. This document should be read in conjunction with the Brae-Forties Pipeline System standard form of general terms and conditions [website link to Section 2].

Transcript of BRAE-FORTIES PIPELINE SYSTEM PIPELINE LIQUIDS ... · Brae-Forties PLTA Section 1 August 2012...

BRAE-FORTIES PIPELINE SYSTEM

PIPELINE LIQUIDS TRANSPORTATION AGREEMENT

SECTION 1

FORM OF AGREEMENT

This document illustrates the structure of the section of the agreement which will contain field-specific terms for transportation of pipeline liquids in the Brae-Forties Pipeline System (Section 1). All text shown in blue and italics is explanatory material. Sample articles in Section 1 are also set out for illustration purposes only; the majority will be tailored to the Shippers’ Field requirements. This document should be read in conjunction with the Brae-Forties Pipeline System standard form of general terms and conditions [website link to Section 2].

Brae-Forties PLTA Section 1 August 2012

AGREEMENT FOR THE TRANSPORTATION OF [FIELD X] PIPELINE LIQUIDS

THIS AGREEMENT is made this [ ] day of [ ] 20[ ].

BETWEEN

1. MARATHON OIL U.K. LLC (“Marathon”) a limited liability company existing under

the laws of Delaware USA, having a UK Establishment with registered number BR001797

at Capital House, 25 Chapel Street, London NW1 5DQ;

2. BP EXPLORATION OPERATING COMPANY LIMITED a company incorporated in

England and Wales (Company Number 00305943) whose registered office is situated at

Chertsey Road, Sunbury on Thames, Middlesex, TW16 7BP;

3. CENTRICA RESOURCES LIMITED a company incorporated in England and Wales

(Company Number 02855151) whose registered office is situated at Millstream,

Maidenhead Road, Windsor, Berkshire SL4 5GD;

4. JX NIPPON EXPLORATION AND PRODUCTION (U.K.) LIMITED a company

incorporated in England and Wales (Company Number 03288689) whose registered office

is situated at 2nd Floor, New Liverpool House, 15 Eldon Street, London EC2M 7LD;

5. TAQA BRATANI LIMITED a company incorporated in England and Wales (Company

Number 05975475) whose registered office is situated at c/o McGrigors LLP, 5 Old Bailey,

London EC4M 7BA;

6. TAQA BRATANI LNS LIMITED a company incorporated in England and Wales

(Company Number 06230540) whose registered office is situated at c/o McGrigors LLP, 5

Old Bailey, London EC4M 7BA;

of the first part (who are the current members of the Brae Group);

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AND

8. [SHIPPER];

9. [SHIPPER]; and

(…) [SHIPPER];

numbers 8, 9 [ ] and [ ] of the second part, (who are the current members of the Shippers Group)

and may be referred to individually herein as a “Shipper”.

WHEREAS:

A. The members of the Brae Group own the Brae-Forties Pipeline System and enter into this

Agreement in that capacity, and Marathon is the current Brae Operator of the Brae-Forties

Pipeline System.

B. Shippers Operator is the operator of the Shippers Field.

C. The Shippers Group have interests in the Shippers Field.

D. The Shippers Group desire to have Shippers Pipeline Liquids transported through the Brae-

Forties Pipeline System and delivered to the FPS System, and the Brae Group is prepared to

so transport such Pipeline Liquids and to deliver such Pipeline Liquids to the FPS System.

E. The Parties now wish to record herein the terms and conditions for the transportation of such

Shippers Pipeline Liquids.

NOW THEREFORE IT IS HEREBY AGREED AS FOLLOWS:-

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ARTICLE 1 – DEFINITIONS AND INTERPRETATION

Definitions which are applicable only to the Producers Field or relate specifically to the

commercial terms in Section 1 are set out in Section 1; common definitions which are used

uniformly throughout the standard terms of Section 2 are set out, principally although not

exclusively, in Clause 1.1 of Section 2.

References in the sample definitions below to an Intervening System will not be applicable

if the Shippers Pipeline is connected directly to the Brae-Forties Pipeline System. Note that

for such a direct connection, a Tie-In Agreement will be required to be entered into between

the Shippers Group and the Brae Group.

1.1 In this Agreement, words and expressions shall have the same meaning as are respectively

assigned to them in this Article 1.1 and Clause 1.1 of Section 2.

Entry Point means [describe] the point at which the [Intervening or Shippers] System

connects to the Brae-Forties Pipeline System and constitutes the point where custody of

Shippers Pipeline Liquids is transferred to the Brae Group.

Intervening System means the processing and transportation system[s] known as the [ ]

[describe] between the Intervening System Entry Point and the Entry Point and connecting

the Shippers System with the Brae-Forties Pipeline System.

Intervening System Entry Point means [ ].

[Intervening System Operator means [ ] in its capacity as operator

of the [ ] System and its successor from time to time in such capacity.]

Shippers Field means the hydrocarbon accumulation[s] generally known as the [ ]

underlying block[s] [ ] within the production licence[s] [ ] on the United Kingdom

continental shelf. A plan showing the Shippers Field is set out in Part A to this Exhibit I.

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Shippers Group means all the companies or corporations from time to time having a

beneficial interest in the Shippers Field and the Shippers System. The Shippers Group

currently comprises:

[ ]

[ ]

Shippers Operator means the operator of the Shippers Field from time to time (which at the

date hereof is [ ]) acting as such on behalf of the Shippers Group.

Shippers Pipeline means [ ].

Shippers Platform means [ ].

Shippers System means the production, [processing] and pipeline facilities and all other

facilities associated therewith existing from time to time and necessary to produce Pipeline

Liquids from the Shippers' Field and to deliver the same to the [Intervening System] Entry

Point. [Such facilities shall include but not be limited to the Shippers Platform, and the

Shippers Pipeline.]

1.2 For all purposes of this Agreement, except as otherwise expressly provided or as the context

otherwise requires:

(a) any reference to an "Article", an "Exhibit" or an “Attachment” refers to an article of

or an exhibit or attachment to this Section 1; and

(b) any reference to a “Clause” refers to a clause of or an attachment to Section 2

as the case may be.

ARTICLE 2 – FORM OF AGREEMENT

This Pipeline Liquids Transportation Agreement is based around three key components:

Form of Agreement (Specific Terms) – each new field is different and sometimes requires an

individual commercial solution depending on the nature of service required. We have

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grouped together the key commercial terms that may vary from field to field, into a simple

streamlined document that can be negotiated and drafted simply and quickly.

Conditions of Contract (General Terms) – The Brae-Forties Pipeline System is a large

integrated oil transportation system with a very large number of customers. This document

details the general terms, conditions and procedures that are applicable to all customers,

that have been developed over time, based on our experience and our commitments, to

ensure the safe, efficient and sustainable operation and management of the system.

Consistency with FPS Agreements – The Brae-Forties Pipeline System, as a system which is

linked to the FPS System and delivers all Pipeline Liquids into the FPS System, must adopt

procedures which ensure operational consistency across both systems. Over time, the Brae-

Forties Pipeline System and FPS have developed agreements which ensure such

consistency. Following the adoption of the current FPS contractual approach, the Brae

Group has elected to introduce and publish on the internet a contract structure which is

similar to the FPS approach, in order to enable potential customers to be satisfied that there

will be a consistent approach to operational matters and to minimize the technical review

required. The Brae Group also expects this will minimize the effort required to review this

Agreement from a commercial and legal perspective, although the Brae Group’s approach

to various commercial and/or legal issues will be substantively independent from the view

taken by FPS.

2.1 This Agreement shall comprise the following documents:-

Section 1 Form of Agreement; and

• Exhibit I Description of Shippers System

• Exhibit II Specification for Shippers Pipeline Liquids

• Exhibit III Composition of Shippers Pipeline Liquids

• Exhibit IV Shippers Pipeline Liquids FMQ Profile

• Attachment A Measurement and Allocation Procedure

Section 2 Conditions of Contract

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2.2 The provisions contained in Section 2, the Conditions of Contract, form part of this

Agreement and have full force and effect as if set out in full within this Section 1.

ARTICLE 3 – SERVICE PROVISION AND COMMENCEMENT

At the time of the execution of this agreement the commencement date will be mutually

agreed between the Brae Group and the Shippers Group, and should be consistent with the

commencement date agreed between the Shippers Group and FPS.

In the event that the field starts production in advance of this date the Brae Group will use

reasonable endeavors to accept such produced volumes.

Duration of the agreement is covered by provisions in Section 2.

3.1 Provision of Services

Subject to the terms and conditions of this Agreement, and in consideration of, inter alia,

payment of the tariff, the Brae Group shall provide the Services.

3.2 Effective date

This Agreement shall be effective on and from the date of its signature.

3.3 Commencement Date

The commencement date for the acceptance of the Shippers Pipeline Liquids shall be [ ]

(the “Commencement Date”).

The Brae Group shall use reasonable endeavours to accept Shippers Pipeline Liquids from

any earlier date, if so requested by notice from the Shippers Operator.

ARTICLE 4 – QUANTITIES

To meet the future throughput requirements of all customers, both new and existing, it is

necessary to manage and optimize capacity within the Brae-Forties Pipeline System.

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In addition to providing customers with certainty of future capacity, successful management

of capacity ensures the Brae-Forties Pipeline System is able to maintain high levels of

service and availability.

The Brae-Forties Pipeline System has adopted a capacity management system designed to ensure an approach which is consistent with the way the FPS manages capacity, using a booking mechanism as illustrated in the diagram below:

We can tailor the booking mechanism to meet the needs of the Shippers Field as set out

below:

4.1 Peak Entitlement

Each contract will contain a Peak Entitlement that will govern the maximum allowable

booked capacity in the system.

The Peak Entitlement is set at the time of contract execution to frame the level of capacity

and service to which the agreed tariff and terms are applicable.

4.2 FMQ (Firm Maximum Quantity)

Each contract will contain an FMQ profile, representing the Shippers Group’s bona-fide

life of field view of production from the field at the time of contract execution.

Each Shippers Group shall be granted capacity rights for the field in the Brae-Forties

Pipeline System equal to the FMQ profile.

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4.3 Changes to FMQ

The frequency of changes to the FMQ profile and the mechanism for establishing the

Unrestricted Booking Range can be tailored to meet the specific needs of the field.

The notice period for booking revisions typically ranges from one year for large fields to

one month for small marginal fields.

The Shippers Group shall be entitled to make unrestricted revisions to the FMQ profile for

the field within the Unrestricted Booking Range.

In addition, each Shippers Group shall be entitled to increase the FMQ profile for the field

above the Unrestricted Booking Range (but not above the Peak Entitlement) subject to there

being sufficient uncontracted capacity available within the Brae-Forties Pipeline System.

The FMQ profile may not be increased above the Peak Entitlement

All FMQ profiles should represent the Shippers Group’s bona-fide view of production for

the life of the field.

The Brae Group and the Shippers Group shall mutually agree a process to resolve any

disputes over the bona-fide nature of FMQ profiles.

4.4 Allocation

If the Shippers Pipeline Liquids are commingled with other pipeline liquids prior to delivery

to the Brae-Forties Pipeline System, the Shipper will be required to procure that the

Intervening System Operator allocates pipeline liquids to the Shippers Field, and advises

the Brae Operator of the results of such allocation.

ARTICLE 5 – QUALITY

The safe operation of the Brae-Forties Pipeline System and the FPS System and the

reputation and value of the Forties Blend rely on the continued management of the quality

and specification of the Shipper’s Pipeline Liquids, and compliance with the FPS System

requirements in this regard must be met, so that the Brae-Forties Pipeline System’s status

as a compliant entry point to the FPS System is not jeopardized. In certain respects, the

standard specification may be stricter than that of the FPS System, where this is required

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for the commingled stream of Pipeline Liquids being delivered from the Brae-Forties

Pipeline System to stay in compliance.

The standard specification has been developed to meet the needs of most fields. For any

variation from the standard specification, the Brae Group will need to ensure that there are

no adverse impacts on the commingled Pipeline Liquids in the Brae-Forties Pipeline System

and, if such variation is also a variation from the FPS System standard specification, the

Shippers Group will be required to warrant that the FPS System has agreed to the variation.

5.1 The quality of Shippers Production delivered at the Entry Point shall comply with the

quality criteria in the specification included in Exhibit II and shall not differ from the

compositional data contained in Exhibit III to an extent which, in the Brae Operator’s

opinion, is material.

ARTICLE 6 – TARIFF AND CHARGES

All tariffs and charges for use of the Brae-Forties Pipeline System will be economically

justified, reflect the nature of the service being provided, and represent a fair balance

between risk taken and return earned.

All tariffs offered for use of the Brae-Forties Pipeline System are guaranteed until 2015,

providing stability and simplicity and protecting the field owner from rising infrastructure

costs.

The Brae Group may exercise an option to charge a share of operating costs in lieu of the

tariff after 2015. This option is set out in Clause 8.04 of Section 2.

6.1 Transportation Tariff

Details of our tariffs can be found on our website at [ ]

6.2 Escalation

The tariff offered will be escalated to reflect inflation in the cost of providing the Services.

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Escalation methods should respect our principle of there being a fair balance between risk

and reward for both parties.

6.3 Send or Pay

Where no capital investment has been made or future capital investments are required to

accommodate a new field or fields, and provided there are no other special circumstances,

there will be no send or pay.

In the circumstances where the Brae Group has made a capital investment or future capital

investments are required to accommodate a new field or other special circumstances apply,

such as extending the term of the agreement in return for continuing a tariff-based service,

or committing a significant portion of remaining capacity, then appropriate Send or Pay

provisions will be agreed to reflect a fair balance between risk and reward

ARTICLE 7 – NOTICES

7.1 Notices

All notices and other communications to be sent hereunder shall, unless otherwise specified

herein, be in writing and sent to the relevant addresses given below, and shall be sufficiently

made if sent by pre-paid first class post, facsimile, electronic mail or by delivering the same

by hand to the address of the other Party specified below (which may be changed from time

to time by notice similarly given)..

Addresses for notices to be sent under this Agreement:

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THE BRAE OPERATOR (for itself and on behalf of the Brae Group)

Marathon Oil U.K. LLC

Att: UK Commercial Manager

By Mail: Marathon House

Rubislaw Hill

Anderson Drive

Aberdeen AB15 6FZ

By Fax: +44 1224 803190

SHIPPERS OPERATOR

Att: [ ]

By Mail [ ]

By Fax [ ]

SHIPPERS GROUP

Att: [ ]

By Mail [ ]

By Fax [ ]

Brae-Forties PLTA Section 1 August 2012

7.2 Effective time

Notices shall be deemed to have been received at the time of delivery if delivered by hand or

sent by electronic mail or fax, and on the second Working Day following the day of sending

if sent by pre-paid first class post. If the time of such deemed receipt is outside customary

hours of business or is on a day other than a Working Day, notices shall be deemed to have

been received and shall be effective from 10.00 hours on the first Working Day thereafter.

ARTICLE 8 – GENERAL PROVISIONS

8.1 Conflict

In the event of any conflict between the Articles and Clauses of this Agreement and

(a) the Exhibits or Attachments to this Agreement; and/or

(b) the Shippers Field Operating Procedures referred to in Clause 10.02 of Section 2;

the terms and conditions of the said Articles and Clauses shall prevail and in the event of

conflict between the terms and conditions of the said Exhibits or Attachments and the said

Shippers Field Operating Procedures, the terms and conditions of the said Exhibits or

Attachments shall prevail.

In the event of any conflict between the provisions of this Section 1 and Section 2 of this

Agreement, then the provisions set out in this Section 1 shall prevail.

8.2 Entire Agreement

(a) Except as provided to the contrary herein, this Agreement and the Attachments

hereto contain the entire agreement between the Parties in respect of the

transportation of Shippers Pipeline Liquids within the Brae-Forties Pipeline System

and supersede any previous understandings, commitments, agreements or

representations whatsoever, oral or written.

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(b) Each Party acknowledges and agrees that it does not enter into this Agreement

relying or having relied upon any statement or representation (whether negligent or

innocent) or warranty or other provision (in any case, whether oral, written, express

or implied) made, given or agreed to by any Person (whether a Party or not) except

those expressly set out or referred to herein and the only remedy or remedies

available in respect of any misrepresentation or untrue statement made to it shall be a

claim for breach of contract under this Agreement.

(c) Article 8.2(b) shall not apply to any statement, representation or warranty made

fraudulently or to any provision of this Agreement which was induced by, or

otherwise entered into as a result of, fraud, for which the remedies shall be all those

available under the law governing this Agreement.

8.3 No waiver

No waiver by any Party of any provision of this Agreement shall be effective unless made

expressly and in writing and then only in the specific instance and for the specific purpose

for which it is given. No delay on the part of a Party in exercising any rights shall operate as

a waiver of them, nor shall a single or partial exercise of any right preclude further exercise

of it.

8.4 Amendment

This Agreement shall not be varied except by an instrument in writing signed by all the

Parties.

8.5 Further Assurance

The Parties shall execute any document, and do everything else that is reasonably necessary

in order to give full effect to the provisions and purposes of this Agreement.

Brae-Forties PLTA Section 1 August 2012

8.6 Counterpart Execution

This Agreement may be executed in any number of counterparts with the same effect as if

the signatures were upon a single engrossment of this Agreement, but shall not be effective

until each Party has executed at least one counterpart. For the purposes of evidencing

execution of this Agreement only, the Parties may be provided with a conformed copy of

this Agreement with photocopies of the relevant signed signature pages attached.

IN WITNESS whereof the Parties hereto have caused this Agreement to be executed by their duly

authorised representatives the day and year first above written.

THE BRAE GROUP

MARATHON OIL U.K. LLC

By: ______________________

BP EXPLORATION OPERATING COMPANY LIMITED

By: ______________________

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CENTRICA RESOURCES LIMITED

By: ______________________

JX NIPPON EXPLORATION AND PRODUCTION (U.K.) LIMITED

By: ______________________

TAQA BRATANI LIMITED

By: ______________________

TAQA BRATANI LNS LIMITED

By: ______________________

Brae-Forties PLTA Section 1 August 2012

SHIPPERS GROUP

For and on behalf of

[SHIPPER]

_________________________

For and on behalf of

[SHIPPER]

_________________________

For and on behalf of

[SHIPPER]

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EXHIBIT I

DESCRIPTION OF THE SHIPPERS FIELD

[MAP/COORDINATES OF THE SHIPPERS’ FIELD]

Brae-Forties PLTA August 2012

EXHIBIT II

SPECIFICATION FOR SHIPPERS PIPELINE LIQUIDS

The following specification is in respect of Shippers Production entering the Brae-Forties Pipeline

System and the FPS System. The analysis used to measure specification items shall be those

contained in the FPS System: “User Specifications: Manual of Measurement Methods”. Where a

method has yet to be agreed, the Brae Operator shall, as required, seek the Shippers Operator’s

agreement to use appropriate methods, such agreement not to be unreasonably withheld.

Carbon Dioxide Maximum of 0.2 mole % of carbon dioxide.

Nitrogen Maximum of 0.2 mole % of nitrogen.

Carbonyl Sulphide Maximum of 0.02 ppm by weight.

Hydrogen Sulphide Maximum of 0.1 ppm by weight as hydrogen

sulphide.

Mercaptans Maximum of 0.1 ppm by weight as sulphur of volatile

mercaptans, which separate into Raw Gas under

Kinneil operating conditions.

Mercury Maximum of 0.35 ng/g as volatile organic or

inorganic mercury, which separate into Raw Gas

under Kinneil operating conditions.

Sediment and Water

Maximum of 2% by volume provided that Shippers

Pipeline Liquids are essentially free of sediment.

Produced water shall be made compatible (at the cost

of the Shippers Group) with water produced by other

FPS System Users.

True Vapour Pressure Maximum of 125 psig at 60oF.

Brae-Forties PLTA August 2012

Viscosity Maximum of 15 centiStokes at 4oC.

Acidity The total acid number shall be no greater than 0.10

mg of potassium hydroxide per gram of Stabilised

Crude Oil derived from Shippers Production.

Emulsions Shippers Production and production from Other Users

when mixed should not form emulsions which are

stable at temperatures at or above 36oC and pressures

at or above one bar absolute.

Metals Vanadium plus nickel shall not exceed 5 ppm by

weight.

Salt Content Maximum of 1500 milligrams per litre of sodium,

calcium and magnesium chlorides in solution.

Entry Pressure The back pressure at the Entry Point is expected to be

in the range 155 to 170 barg with a maximum

pressure of 175 barg required to be overcome by the

Shippers Production.

Oxygenates Shippers Production shall not contain oxygenates.

Alcohols Shippers Production shall not contain alcohols.

General No chemical additives or processing material shall be

injected into Shippers Production either directly or

through processing without prior consultation and

agreement with the Brae Operator and the FPS

System Operator. All chemical additives must comply

with the Offshore Chemical Notification Scheme

(OCNS) (as administered by the Department of

Energy and Climate Change) and no endocrine

disrupter are permitted.

Brae-Forties PLTA August 2012

Shippers Production to be free of undesirable

substance or material (including, without limitation,

radioactive materials).

Brae-Forties PLTA August 2012

EXHIBIT III

COMPOSITION OF SHIPPERS PIPELINE LIQUIDS

Component (mole %)

N2

CO2

H2S

C1

C2

C3

IC4

C4

IC5

C5

C6+

Mol weight of Shippers Pipeline Liquids kg/kmol

Density of Shippers Pipeline Liquids kg/m3

Mol weight of C6+ kg/kmol

Density of C6+ kg/m3

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EXHIBIT IV

SHIPPERS PIPELINE LIQUIDS FMQ PROFILE

[ Agreed Period ] FMQ (mbd)

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ATTACHMENT A - MEASUREMENT AND ALLOCATION

For use with an Intervening System

The definitions set out in Sections 1 and 2 of the Agreement shall apply to this Attachment A.

1.0 Principles

The allocation procedure set out in this Attachment A is for the purpose of apportioning the

total flow of Pipeline Liquids leaving the Brae-Forties Pipeline System and the stocks and

losses (if any) within the Brae-Forties Pipeline System. This allocation procedure is based

upon the mass and composition of each User’s Pipeline Liquids flow into the Brae-Forties

Pipeline System.

For allocation purposes only the composition of each User’s Pipeline Liquids is deemed to

be unaffected by commingling within the Brae-Forties Pipeline System.

2.0 Product Allocation Procedure

The proportion of Shippers Pipeline Liquids leaving the Intervening System and the

proportion of Shippers Pipeline Liquids contributed to stock in the [Intervening System

pipeline]is determined by the Intervening System product allocation procedure as agreed

between the owners of the Intervening System and the Shippers Group.

3.0 Data

The following data shall be provided by the Shippers Operator to the Brae Operator.

3.1 Total quantity of Pipeline Liquids as measured by approved meters including:

(i) Mass in Tonnes

(ii) Volume under standard conditions:

(a) Cubic metres at 15°C and 1.01325 bara

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(b) Barrels at 60°F and 14.7 psia

(iii) Sediment and water; weight % and volume %

(iv) Mercaptan sulphur content by weight ppm, determined by on-line measurement on

the[Intervening System facilities].

3.2 The above data shall be provided by the Shippers Operator to the Brae Operator for 24 hours

ending 1800 hours.

3.3 Stock changes in the [Intervening System pipeline] (from meters on the [Intervening System

facilities] to the Entry Point) as calculated by the Intervening System Operator shall be

reported to the Brae Operator within one (1) working day of the end of each FPS System

allocation period.

4.0 Brae-Forties Pipeline System Stocks

4.1 Stock and stock changes (mass dry and wet in Tonnes for oil and gas) of Shippers Pipeline

Liquids within the Brae-Forties Pipeline System shall be calculated by the Brae Operator in

accordance with the Brae Pipeline stocks procedure and advised to the Shippers Operator for

period required by the FPS System as follows:

(i) The total volume of Brae-Forties Pipeline System stocks at the end of a FPS System

allocation period is calculated.

(ii) The period required to fill the stocks in the Brae-Forties Pipeline System in

calculated taking into account each section of the Brae-Forties Pipeline System and

the volume of each User’s production in each of the days prior to the end of a FPS

System allocation period.

(iii) Each User’s contribution to the stocks is the volume of Shippers Pipeline Liquids

during the period referred to in 4.1(ii) above.

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(iv) Each User’s contribution determined under 4.1(iii) above is converted into mass

(dry) after taking into account temperature and pressure of Pipeline Liquids in the

Brae-Forties Pipeline System, the water and sediment and the density of each User’s

Pipeline Liquids to give Shippers Pipeline Liquids’ share of stock mass (dry).

(v) Each User’s oil’s stock change mass (dry) is determined by subtracting its share of

stock mass (dry) at the end of the preceding FPS System allocation period from its

share at the end of the FPS System allocation period in question.

(vi) An adjustment for a proportion of the Brae-Forties Pipeline System losses (if any),

occurring during the FPS System allocation period in question, on the basis of the

Shippers Group’s share of the stock mass (dry) at the end of the FPS System

allocation period.

4.2 The Shippers Group’s share of the Intervening System Pipeline Liquids contribution to

stock in the Brae-Forties Pipeline System shall be determined by the Intervening System

product allocation procedure.

5.0 Metering

Metering and allocation systems in the Intervening System and the Shippers System shall be

such as may be acceptable from time to time to the Brae Operator (in consultation with the

Shippers Operator).