Preview
NO. 2014-10194
SABINE OIL & GAS LLC f/k/a NFR § IN THE DISTRICT COURT
ENERY LLC, §
§
Plaintiff, §
§
VS. §
§ HARRIS COUNTY, TEXAS
PVR MIDSTREAM LLC AND PVR §
PARTNERS L.P., §
§
Defendants. § 133"! JUDICIAL DISTRICT
DEFENDANTS’ ORIGINAL ANSWER
Defendants PVR Midstream I.LC and PVR Partners L.P. answer Plaintiff's Original
Petition as follows:
General Denial
Pursuant to Tex. R. Civ. P. 92, Defendants generally deny the allegations contained in
Plaintiffs Original Petition.
Specific Denial
Pursuant to Tex. R. Civ. P. 54, Defendants deny that conditions precedent to recovery
by Plaintiff have been performed or have occurred, deny that Plaintiff has complied with
Rule 47, deny that Plaintiff is entitled to recover damages against these Defendants for
breach of contract, deny that Defendants are obligated to make payments under a contract in
which they are not a party, deny that Defendants made promises to Plaintiff, and deny that
Plaintiff is entitled to recovery attorney’s fees against a person or corporation not identified
in the contract.
Defendants deny Plaintiffs contention that “Defendants were to purchase the
unprocessed natural gas from Plaintiff at the Receipt Point.” Section 4.1 of the Gas Purchase
Contract does not state that Defendants were to “purchase unprocessed natural gas at theReceipt Point.” Rather, Section 4.1 of the Gas Purchase Contract states that “The Receipt
Point for Gas purchased and sold hereunder shall be at the inlet flange of Buyer’s meter or, if
applicable, Buyer’s separator or drip reservoir located in front of such meter.”
Measurements were taken at the Receipt Points for the purpose of allocation, not payment,
and volumes were adjusted on a pro rata basis to the actual total Gas volume and
corresponding heating values calculated at the inlet to the Plant (Section 1.1 “Allocated Share
of Inlet Gas”) and, effective June 27, 2011, according to the method of allocating NGL
Products and Residue Gas set forth in Section 1.2 (“Allocation of Receipt Point Volumes”)
of the Sixth Amendment to Gas Purchase Contract. Whereas, Buyer took title and delivery
of Seller’s Gas at the Receipt Points, Seller was paid the Net Price for its Allocated Share of
Inlet Gas, meaning the gross proceeds received by Buyer f.0.b. the Plant from the sale of all
Products after deducting all direct and indirect expenses, taxes, fees and adjustments,
including, but not limited to, transportation (third party and affiliated party), fractionation,
marketing, storage, blending or treating fees, pipeline losses and retainage, and adjustments
for Product quality incurred or made by Buyer in connection with the sale of said Products
(Section 1.15 “Net Price”), and was paid the Residue Gas Price for its share of its Allocated
Share of Inlet Gas, meaning the Gas remaining after processing in the Plant for extraction of
Products, deduction for fuel, condensate extracted upstream of the Plant, and unaccounted for
Gas losses (Section 1.21 “Residue Gas” and as thereafter amended), Defendants deny
Plaintiff’s contention that Net Price and Residue Gas Price were inaccurately calculated.
Verified Denial
The subject Gas Purchase Contract, dated April 1, 2009, was made between NFR
Energy LLC (“Seller”) and PVR East Texas Gas Processing LLC (“Buyer”). Pursuant toTex. R. Civ. P. 93, Defendants contend that there is a defect of partics, in that PVR
Midstream LLC and PVR Partners L.P. are not parties to the Gas Purchase Contract that is
the subject of this action, and are not proper parties to this action.
Defendants deny Plaintiff's contention that PVR East Texas Gas Processing LLC
acted as a representative or agent for PVR Midstream LLC, and deny that PVR Midstream
LLC was owned by PVR Partners L.P.
At all relevant times, PVR East Texas Gas Processing LLC (Delaware) was owned by
PVR Gas Resources LLC (Delaware), and PVR Midstream LLC (Delaware) was owned by
PVR Finco LLC (Delaware).
The subject Gas Purchase Contract dated April 1, 2009, was terminated as of April 1,
2012, and is no longer in force.
Effective July 2, 2012, all of the membership units owned by PVR Gas Resources
LLC in PVR East Texas Gas Processing LLC were sold to DCP Midstream Partners L.P.
(Delaware) (not affiliated with PVR).
Effective October 22, 2012, PVR Gas Resources LLC (Delaware) was merged into
PVR Midstream LLC (Delaware).
Effective March 21, 2014, PVR Partners L.P. ceased to be a publicly traded company,
its outstanding units discontinued trading on the NYSE and converted to units of Regency
Energy Partners L.P., and it was merged into Regency Energy Partners L.P.
Affirmative Defense
Pursuant to Tex. R. Civ. P. 94, Defendants contend that the assertion of contract
claims by Plaintiff extending beyond four years from the date of filing of its petition—that is,
any claims preceding 2/27/10—are barred by the statute of limitations. Defendants deny thatSection 12.2 of the Gas Purchase Contract extends the statute of limitations for contract
claims.
Affirmative Defense
Pursuant to Tex. R. Civ. P. 94, Defendants contend that Plaintiff waived any defaults
by PVR East Texas Gas Processing LLC in the performance of the Gas Purchasing Contract.
Prayer
Defendants PVR Midstream LLC and PVR Partners LP pray that Plaintiff Sabine Oil
& Gas LLC take nothing, and that Defendants be awarded such other and further relief to
which they may show themselves entitled.
Respectfully submitted,
Ase Sy
K. B. Battaglini
kbattaglini@strongpipkin.com
Texas Bar No. 01918060
Michael T. Bridwell
mbridwell @strongpipkin.com
Texas Bar No. 02979600
Elliott W. Taliaferro
etaliafe strongpipkin.
Texas Bar No. 24079431
STRONG PIPKIN BISSELL & LEDYARD LLP
4900 Woodway Drive, Suite 1200
Houston, Texas 77056
713.210.4371
713.651.1920 fax
Attorneys for Defendants PVR Midstream LLC
and PVR Partners L.P.Declaration
My name is Brody C, Stevens. I serve as Senior Counsel for Regency Energy
Partners L.P. and subsidiaries. My address is Three Radnor Corporate Center, 100
Matsonford Road, Suite 301, Radnor, Pennsylvania 19087. I am over the age of 18, and I
declare under perjury that the foregoing Verified Denial is true and correct.
Executed this 31° day of March, 2014, in Delaware County, Pennsylvania.
Brody whZed ~
CERTIFICATE OF SERVICE
This will certify a true and correct copy of Defendants’ Original Answer was served
this 31" day of March, 2014, on Plaintiff's counsel of record by electronic mail and by certified
mail properly addressed as follows:
Thomas T. Hutcheson
Tom Van Arsdel
Matthew Z. Hawthorne
WINSTEAD PC
1100 JP Morgan Chase Tower
600 Travis Street
Houston, Texas 77002
eR
K.B. rs a
Preview
NO. 2014-10194 SABINE OIL & GAS LLC f/k/a NFR § IN THE DISTRICT COURT ENERY LLC, § § Plaintiff, § § VS. § § HARRIS COUNTY, TEXAS PVR MIDSTREAM LLC AND PVR § PARTNERS L.P., § § Defendants. § 133"! JUDICIAL DISTRICT DEFENDANTS’ ORIGINAL ANSWER Defendants PVR Midstream I.LC and PVR Partners L.P. answer Plaintiff's Original Petition as follows: General Denial Pursuant to Tex. R. Civ. P. 92, Defendants generally deny the allegations contained in Plaintiffs Original Petition. Specific Denial Pursuant to Tex. R. Civ. P. 54, Defendants deny that conditions precedent to recovery by Plaintiff have been performed or have occurred, deny that Plaintiff has complied with Rule 47, deny that Plaintiff is entitled to recover damages against these Defendants for breach of contract, deny that Defendants are obligated to make payments under a contract in which they are not a party, deny that Defendants made promises to Plaintiff, and deny that Plaintiff is entitled to recovery attorney’s fees against a person or corporation not identified in the contract. Defendants deny Plaintiffs contention that “Defendants were to purchase the unprocessed natural gas from Plaintiff at the Receipt Point.” Section 4.1 of the Gas Purchase Contract does not state that Defendants were to “purchase unprocessed natural gas at theReceipt Point.” Rather, Section 4.1 of the Gas Purchase Contract states that “The Receipt Point for Gas purchased and sold hereunder shall be at the inlet flange of Buyer’s meter or, if applicable, Buyer’s separator or drip reservoir located in front of such meter.” Measurements were taken at the Receipt Points for the purpose of allocation, not payment, and volumes were adjusted on a pro rata basis to the actual total Gas volume and corresponding heating values calculated at the inlet to the Plant (Section 1.1 “Allocated Share of Inlet Gas”) and, effective June 27, 2011, according to the method of allocating NGL Products and Residue Gas set forth in Section 1.2 (“Allocation of Receipt Point Volumes”) of the Sixth Amendment to Gas Purchase Contract. Whereas, Buyer took title and delivery of Seller’s Gas at the Receipt Points, Seller was paid the Net Price for its Allocated Share of Inlet Gas, meaning the gross proceeds received by Buyer f.0.b. the Plant from the sale of all Products after deducting all direct and indirect expenses, taxes, fees and adjustments, including, but not limited to, transportation (third party and affiliated party), fractionation, marketing, storage, blending or treating fees, pipeline losses and retainage, and adjustments for Product quality incurred or made by Buyer in connection with the sale of said Products (Section 1.15 “Net Price”), and was paid the Residue Gas Price for its share of its Allocated Share of Inlet Gas, meaning the Gas remaining after processing in the Plant for extraction of Products, deduction for fuel, condensate extracted upstream of the Plant, and unaccounted for Gas losses (Section 1.21 “Residue Gas” and as thereafter amended), Defendants deny Plaintiff’s contention that Net Price and Residue Gas Price were inaccurately calculated. Verified Denial The subject Gas Purchase Contract, dated April 1, 2009, was made between NFR Energy LLC (“Seller”) and PVR East Texas Gas Processing LLC (“Buyer”). Pursuant toTex. R. Civ. P. 93, Defendants contend that there is a defect of partics, in that PVR Midstream LLC and PVR Partners L.P. are not parties to the Gas Purchase Contract that is the subject of this action, and are not proper parties to this action. Defendants deny Plaintiff's contention that PVR East Texas Gas Processing LLC acted as a representative or agent for PVR Midstream LLC, and deny that PVR Midstream LLC was owned by PVR Partners L.P. At all relevant times, PVR East Texas Gas Processing LLC (Delaware) was owned by PVR Gas Resources LLC (Delaware), and PVR Midstream LLC (Delaware) was owned by PVR Finco LLC (Delaware). The subject Gas Purchase Contract dated April 1, 2009, was terminated as of April 1, 2012, and is no longer in force. Effective July 2, 2012, all of the membership units owned by PVR Gas Resources LLC in PVR East Texas Gas Processing LLC were sold to DCP Midstream Partners L.P. (Delaware) (not affiliated with PVR). Effective October 22, 2012, PVR Gas Resources LLC (Delaware) was merged into PVR Midstream LLC (Delaware). Effective March 21, 2014, PVR Partners L.P. ceased to be a publicly traded company, its outstanding units discontinued trading on the NYSE and converted to units of Regency Energy Partners L.P., and it was merged into Regency Energy Partners L.P. Affirmative Defense Pursuant to Tex. R. Civ. P. 94, Defendants contend that the assertion of contract claims by Plaintiff extending beyond four years from the date of filing of its petition—that is, any claims preceding 2/27/10—are barred by the statute of limitations. Defendants deny thatSection 12.2 of the Gas Purchase Contract extends the statute of limitations for contract claims. Affirmative Defense Pursuant to Tex. R. Civ. P. 94, Defendants contend that Plaintiff waived any defaults by PVR East Texas Gas Processing LLC in the performance of the Gas Purchasing Contract. Prayer Defendants PVR Midstream LLC and PVR Partners LP pray that Plaintiff Sabine Oil & Gas LLC take nothing, and that Defendants be awarded such other and further relief to which they may show themselves entitled. Respectfully submitted, Ase Sy K. B. Battaglini kbattaglini@strongpipkin.com Texas Bar No. 01918060 Michael T. Bridwell mbridwell @strongpipkin.com Texas Bar No. 02979600 Elliott W. Taliaferro etaliafe strongpipkin. Texas Bar No. 24079431 STRONG PIPKIN BISSELL & LEDYARD LLP 4900 Woodway Drive, Suite 1200 Houston, Texas 77056 713.210.4371 713.651.1920 fax Attorneys for Defendants PVR Midstream LLC and PVR Partners L.P.Declaration My name is Brody C, Stevens. I serve as Senior Counsel for Regency Energy Partners L.P. and subsidiaries. My address is Three Radnor Corporate Center, 100 Matsonford Road, Suite 301, Radnor, Pennsylvania 19087. I am over the age of 18, and I declare under perjury that the foregoing Verified Denial is true and correct. Executed this 31° day of March, 2014, in Delaware County, Pennsylvania. Brody whZed ~ CERTIFICATE OF SERVICE This will certify a true and correct copy of Defendants’ Original Answer was served this 31" day of March, 2014, on Plaintiff's counsel of record by electronic mail and by certified mail properly addressed as follows: Thomas T. Hutcheson Tom Van Arsdel Matthew Z. Hawthorne WINSTEAD PC 1100 JP Morgan Chase Tower 600 Travis Street Houston, Texas 77002 eR K.B. rs a