TITLE
Recommendation to authorize City Manager to execute the First Amendment to the Produced Water Agreement between the City of Long Beach, Tidelands Oil Production Company, and Oil Operators, Inc., for a seven-year term, with automatic renewal for successive one-year periods unless any party elects to terminate the Agreement within 30 days of its expiration; and authorize City Manager to execute any subsequent amendments to the Produced Water Agreement.
(Districts 1,2)
DISCUSSION
In 2001, the City of Long Beach (acting in its capacity as Unit Operator for Unit
Segments I and II under the Unit Agreements for Fault Block Units II, 111, IV, and V
Ranger Zone, as operator of certain un-unitized formations, and as operator of
certain general facilities in the Wilmington Oil Field) and the Tidelands Oil Production
Company (Contractor), the City’s oil field contractor, entered into a Produced Water
Agreement (Agreement) with Oil Operators, Inc. (OOI), a private company operating
in Long Beach. The Agreement covered the terms of delivery of water produced by
001 as a normal by-product of its oil production operations in Signal Hill and Long
Beach oil production operations. The City uses the water in its west Wilmington area
oil operations, which has an ongoing need for additional injection water. Under the
Agreement, 001 provides the water delivery and bears all related capital costs,
including a volume-based treatment fee to be paid by them to the Contractor. The
Agreement estimates the delivery volume as approximately 30,000 barrels per day
and is in the fifth year of a seven-year term, automatically renewable for successive
one-year periods, unless any party elects to terminate the Amendment within 30 days
of its expiration.
The First Amendment to the Produced Water Agreement (Amendment) modifies the
term of the Agreement. The term of the Amendment is for seven years, automatically
renewable for successive one-year periods, unless any party elects to terminate...
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