Exact Name of Registrant as | Commission | I.R.S. Employer | ||
Specified in Its Charter | File Number | Identification No. | ||
HAWAIIAN ELECTRIC INDUSTRIES, INC. | 1-8503 | 99-0208097 | ||
and Principal Subsidiary | ||||
HAWAIIAN ELECTRIC COMPANY, INC. | 1-4955 | 99-0040500 |
Hawaiian Electric Industries, Inc. Yes x No o | Hawaiian Electric Company, Inc. Yes x No o |
Hawaiian Electric Industries, Inc. Yes x No o | Hawaiian Electric Company, Inc. Yes x No o |
Hawaiian Electric Industries, Inc. Yes o No x | Hawaiian Electric Company, Inc. Yes o No x |
Hawaiian Electric Industries, Inc. | Large accelerated filer x | Hawaiian Electric Company, Inc. | Large accelerated filer o | |||
Accelerated filer o | Accelerated filer o | |||||
Non-accelerated filer o | Non-accelerated filer x | |||||
(Do not check if a smaller reporting company) | (Do not check if a smaller reporting company) | |||||
Smaller reporting company o | Smaller reporting company o |
Class of Common Stock | Outstanding April 28, 2016 | |
Hawaiian Electric Industries, Inc. (Without Par Value) | 107,890,279 Shares | |
Hawaiian Electric Company, Inc. ($6-2/3 Par Value) | 15,805,327 Shares (not publicly traded) |
Hawaiian Electric Exhibit 10.1 | Inter-island Supply Contract for Petroleum Fuels by and between Chevron U.S.A. Inc. and Hawaiian Electric, Hawaii Electric Light and Maui Electric dated February 18, 2016 (confidential treatment has been requested for portions of this exhibit) | |
Hawaiian Electric Exhibit 10.2 | Supply Contract for LSFO, Diesel and MATS Fuel by and between Hawaiian Electric and Chevron U.S.A. Inc. dated February 18, 2016 (confidential treatment has been requested for portions of this exhibit) | |
Hawaiian Electric Exhibit 10.3 | Fuels Terminalling Agreement by and between Chevron U.S.A. Inc. and Hawaii Electric Light dated February 18, 2016 (confidential treatment has been requested for portions of this exhibit) | |
HEI Exhibit 31.1 | Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Constance H. Lau (HEI Chief Executive Officer) | |
HEI Exhibit 31.2 | Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of James A. Ajello (HEI Chief Financial Officer) | |
Hawaiian Electric Exhibit 31.3 | Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Alan M. Oshima (Hawaiian Electric Chief Executive Officer) | |
Hawaiian Electric Exhibit 31.4 | Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Tayne S. Y. Sekimura (Hawaiian Electric Chief Financial Officer) | |
HEI Exhibit 32.1 | HEI Certification Pursuant to 18 U.S.C. Section 1350* | |
Hawaiian Electric Exhibit 32.2 | Hawaiian Electric Certification Pursuant to 18 U.S.C. Section 1350** |
HAWAIIAN ELECTRIC INDUSTRIES, INC. | HAWAIIAN ELECTRIC COMPANY, INC. | |||
(Registrant) | (Registrant) | |||
By | /s/ Constance H. Lau | By | /s/ Alan M. Oshima | |
Constance H. Lau | Alan M. Oshima | |||
President and Chief Executive Officer | President and Chief Executive Officer | |||
(Principal Executive Officer of HEI) | (Principal Executive Officer of Hawaiian Electric) | |||
By | /s/ James A. Ajello | By | /s/ Tayne S. Y. Sekimura | |
James A. Ajello | Tayne S. Y. Sekimura | |||
Executive Vice President and | Senior Vice President | |||
Chief Financial Officer | and Chief Financial Officer | |||
(Principal Financial and Accounting | (Principal Financial Officer of Hawaiian Electric) | |||
Officer of HEI) | ||||
Date: September 26, 2016 | Date: September 26, 2016 |
1.1. | “Affiliate”, except where otherwise expressly provided, means an entity controlling, controlled by or under common control with Seller or Hawaiian Electric, Hawaii Electric Light and Maui Electric, as the case may be. For the purpose of this definition “control” (including with correlative meanings, “controlling,” “controlled by,” and “under common control with”) means the power to direct or cause the direction of the management and policies of such entity, directly or indirectly, whether through the ownership of a majority of voting securities, by contract or otherwise, and it being understood and agreed that with respect to a corporation, limited liability company, or partnership, control shall mean direct or indirect ownership of equal to or more than 50% of the voting stock or limited liability company interest or general partnership interest or voting interest in any such corporation, limited liability company or partnership. |
1.2. | “API” means American Petroleum Institute, a long-established petroleum industry organization. |
1.3. | “API Gravity” refers to the API’s standard measurement of gravity for petroleum products using ASTM test method. |
1.4. | “ASTM” means the American Society for Testing and Materials, a long-established source of standard testing and evaluation methods for petroleum. |
1.5. | “barrel” means 42 American bulk gallons at 60 degrees Fahrenheit (“DF”). |
1.6. | “BTU” and “BTU content” means British Thermal Unit and refers to the standard assessment of fuel’s gross heating value or gross heat content. |
1.7. | “business day” shall mean Monday through Friday, except for a day as to which physical locations of commercial banks in Honolulu, Hawaii are closed for business to the public due to a scheduled holiday. |
1.8. | “Certificate of Quality” or “Quality Certificate” means the formal document recording the Seller’s laboratory determination of quality and BTU content of a particular sample which represents a specific Delivery, said laboratory determinations having been performed in accordance with the test methods specified herein. |
1.9. | “Commission” means the State of Hawaii Public Utilities Commission. |
1.10. | “Commission Approval Order” is defined in Section 2.2 below. |
1.11. | “Consumer Advocate” means the Division of Consumer Advocacy of the Department of Commerce and Consumer Affairs of the State of Hawaii. |
1.12. | “Contract” means this Inter-island Petroleum Fuel Supply Contract between Seller and the Companies. |
1.13. | “day” or “days” means a calendar day of 24 hours. |
1.14. | “Deliver”, “Delivery”, “Deliveries” or “Delivered” refers to the transfer of title or physical movement of Fuel by Seller and purchased by the Companies. |
1.15. | “DF” means degrees Fahrenheit. |
1.16. | “Diesel” means No. 2 Diesel produced in conformity with the provisions of the quality in the Specification which are set forth herein. |
1.17. | “DOT” means the Department of Transportation of the State of Hawaii and/or of the United States, as the case may be. |
1.18. | “Effective Date” is defined in Section 2.3 below. |
1.19. | “ETA” means estimated time of arrival. |
1.20. | “Extension” means any Contract term in addition to and after the Original Term, each of which is a 12-Month period beginning January 1. |
1.21. | “Fuel” means singularly and collectively IFO, Diesel and/or ULSD suitable for use as a fuel for utility power generation of the quality specifications described herein. |
1.22. | “gallon” means a United States liquid gallon of 231 cubic inches at 60 DF. |
1.23. | “Governmental Authority” means any international, foreign, federal, state, regional, county, or local Person having governmental or quasi-governmental authority or subdivision thereof, including recognized courts of Law, or other body or entity of competent jurisdiction. |
1.24. | “G.S.V.” means gross standard volume in U.S. Barrels at 60 DF. |
1.25. | “IFO” means Industrial Fuel Oil produced in conformity with the provisions of the quality in the Specifications which are set forth herein. |
1.26. | [...] |
1.27. | “Independent Inspector” means a qualified third-party petroleum inspection contractor acceptable to both Parties providing petroleum sampling, measurement and other services before, during and after a Delivery. |
1.28. | “Law” means any law, decree, directive, judgment, order, decision, interpretation, enforcement, statute, code, ordinance, rule, regulation, treaty, convention, or any action, direction or intervention or other requirement of any Governmental Authority. |
1.29. | “month” means a calendar month. |
1.30. | “Nominated” and “Nomination” means the amount of Fuel specified by the Companies to be sold and Delivered by Seller and purchased and received by the Companies for a specified Month. |
1.31. | “Original Term” is defined in Section 2.1 below. |
1.32. | “Party” and “Parties” are defined in the first paragraph above. |
1.33. | “Receiving Facility” means any of the Companies’ generating facilities, storage facilities and/or other facilities used to receive, transport, store, or otherwise handle Fuel located on the islands of Oahu, Hawaii, Maui, or Molokai as designated by the Companies. |
1.34. | “Refinery” means Seller’s oil refining, and related facilities located in the Barbers Point area of Oahu, in the Campbell Estate Industrial Park, Kapolei, Hawaii. |
1.35. | “Specification” means the fuel quality specifications applicable to Fuel as set forth herein and described in Exhibit A. |
1.36. | “Tank Final Sample” is defined in Section 6.5 below. |
1.37. | “Term” means the Original Term and any Extension(s). |
1.38. | “Terminalling Agreement” means that certain Fuels Terminalling Agreement, dated February 18, 2016, by and between Chevron U.S.A. Inc. (through its division Chevron Products Company) and Hawaii Electric Light Company, Inc. |
1.39. | “ULSD” means Ultra-Low Sulfur Diesel produced in conformity with the provisions of the quality in the Specification which are set forth herein. |
1.40. | “USD” means currency denominated in U.S. dollars. |
1.41. | “Year” means a calendar year. |
1. | Liftings from truck rack: Seller agrees to Deliver and the Companies agree to receive ULSD into the Companies’ Nominated tanker trucks from Seller’s nominated terminal truck rack as listed in Exhibit B at a minimum Delivery rate of 190 barrels per hour. |
2. | Deliveries by Seller to Company Sites: Seller agrees to Deliver and the Companies agree to receive Diesel Delivered by pipeline, or Diesel and/or ULSD Delivered by Seller’s barge to Companies designated storage as listed in Exhibit B, provided however that the size and capability of Seller’s delivery equipment is satisfactory to the Companies. […] |
(i) | For Truck Rack Deliveries, Seller shall own, lease or have the right to use facilities sufficient to meet Seller’s Delivery obligations under this Contract. |
(ii) | For Barge Deliveries, Seller and Companies shall own, lease, or have the right to use vessels/barges to meet each Party’s Delivery or receipt obligations under this Contract. Each nominated vessel employed to Deliver or receive Fuel shall comply with all regulations, pier and terminal operator’s standards for vessel acceptance quality, pollution mitigation, required pollution liability, Protection and Indemnity Insurance (“P&I”) and other insurance coverages, pier operators Operations Manual and accept liability for dues and other charges on said vessel. |
(iii) | […] |
1. | a failure of performance of any Person other than one of the Parties (except to the extent that such failure otherwise would constitute a Force Majeure but for this exclusion); |
2. | any market, financial or economic conditions that are unfavorable for either Party; |
3. | the ability of a Party to obtain better economic terms from a third party or the inability to economically perform its obligations under any transaction undertaken pursuant to this Contract; or |
4. | an unexcused failure by a Party to pay any undisputed amounts due to a third party when due or to perform timely any obligations owed to a third party; and any event described in Section 12.4 and Section 12.5 (which shall instead be addressed in accordance with Section 12.4 or Section 12.5, as applicable). |
HAWAIIAN ELECTRIC COMPANY, INC. | CHEVRON PRODUCTS COMPANY, | |
a division of Chevron U.S.A. Inc. | ||
By /s/ Ronald R. Cox______________________ | By /s/ Billy Liu___________________________ | |
Its Ronald R. Cox | Its Billy Liu | |
Vice President, Power Supply | Hawaii VCO Coordinator | |
HAWAII ELECTRIC LIGHT COMPANY, INC. | MAUI ELECTRIC COMPANY, LTD. | |
By /s/ Jay Ignacio_________________________ | By /s/ Sharon M. Suzuki_____________________ | |
Its Jay Ignacio | Its Sharon M. Suzuki | |
President | President | |
By /s/ Tayne Sekimura____________________ | By /s/ Lyle J. Matsunaga_____________________ | |
Its Tayne Sekimura | Its Lyle J. Matsunaga | |
Sr. VP & Chief Financial Officer | Assistant Treasurer |
Item | Specifications | ASTM Test Method | ||
Gravity @ 60° F, API | 6.5 min. | D1298 or D4052-86 | ||
Flash, °F | 150 min. | D93, D6450 | ||
Viscosity, SSF @ 122°F | 179 min., 226 max. | D445/D2161 | ||
Pour Point, °F | 55 max. | D97 | ||
Sulfur, % Wt. | 2.00 max. | D1552, D2622 or D4294 | ||
Sediment & Water, % Vol. | 0.5 max. | D1796 | ||
BTU content *, MM BTU/BBL | 6.0 | D240 | ||
Vanadium **, PPM wt. | 100 | D5863 | ||
Nitrogen ***, PPM wt. | 6500 | D5762 or D4629 | ||
* Typical Value is 6.3 MM BTU/bbl, value is typical; it is not guaranteed. | ||||
** Typical Value is shown, value is not a specification limit. | ||||
*** Typical Value is shown, value is not a specification limit. |
Item | Units | Specification Limits | Test Method | |||
Gravity @ 60°F | °API, Specific | 30.0 min., .88 min. | D1298 or D4052-86 | |||
Viscosity @ 100 DF | SSU | 32.3 - 40.0 | D445, D2161 | |||
BTU content * | MM BTU/BBL | 5.84 | Calculated or D240 | |||
Heat Value, Net | MM BTU/BBL | Report | Calculated or D240 | |||
Flash Point, PM | °F | 150 min. | D93, D6450 | |||
Pour Point * | °F | 35 | D97 | |||
Ash | PPM, wt. | 100 max. | D482 | |||
Cetane Index | 40 min. | D4737 | ||||
Carbon Residue, | ||||||
10% Residuum | %, wt. | 0.35 max. | D524 | |||
Sediment & Water | %, vol. | 0.05 max. | D1796 | |||
Sulfur | %, wt. | 0.40 max. | D1552, D2622 or | |||
D4294 | ||||||
Distillation | ||||||
90% Recovered | °F | 540 - 650 | D86 | |||
Sodium+Potassium | PPM, wt. | 0.5 max. | D3605 | |||
Sodium+Pot+Lithium | PPM, wt. | Report | D3605 | |||
Vanadium ** | PPM, wt. | 0.8 | D3605 | |||
Nitrogen *** | PPM, wt. | 120 | D4629 or D5762 | |||
* Typical values is shown. | ||||||
** Typical value is shown. | ||||||
*** Typical value is shown. |
Test Property | Test Method | Unit of Measure | Min | Max | ||
APPEARANCE | (None) | Visual | ||||
ASH | ASTM D482 | % mass | 0.01 | |||
CARBON RESIDUE: RAMS 10% | ||||||
BOTTOMS | ASTM D524-04 | % mass | 0.35 | |||
CETANE INDEX | ASTM D4737-04 | Number | 40.0 | |||
One of the following must be met: | ||||||
CETANE INDEX | ASTM D976-06 | Number | 40.0 | |||
Or | ||||||
AROMATICITY | ASTM D1319 | Vol % | 35 | |||
COPPER STRIP CORROSION: 3 HR | ||||||
@ 50C | ASTM D130-04e1 | Classification | 3 | |||
DISTILLATION: 90% RECOVERED | ASTM D86-07a | *C | 282 | 338 | ||
DYE | ||||||
FLASH POINT: P-M | ASTM D93-07 | *C | 52 | |||
FLASH POINT: P-M | ASTM D93-07 | *F | 125 | |||
LUBRICITY, 60C, WSD | ASTM D6079 | Mcrons | 520 | |||
SULFUR | ASTM D5453 | ppm by WT | 15 | |||
CONDUCTIVITY | ASTM D2624/D 4308 | pS/m pr C.U. | 25 | |||
VISCOSITY: KIN @ 40C | ASTM D445-06 | cSt | 1.9 | 4.1 | ||
WATER & SEDIMENT | ASTM D1796-04 | % vol | 0.05 | |||
1.1 | “Affiliate”, except where otherwise expressly provided, means an entity controlling, controlled by or under common control with Seller or Hawaiian Electric, as the case may be. For the purposes of this definition “control” (including with correlative meanings, “controlling,” “controlled by,” and “under common control with”) means the power to direct or cause the direction of the management and policies of such entity, directly or indirectly, whether through the ownership of a majority of voting securities, by contract or otherwise, and it being understood and agreed that with respect to a corporation, limited liability company, or partnership, control shall mean direct or indirect ownership of equal to or more than 50% of the voting stock or limited liability company interest or general partnership interest or voting interest in any such corporation, limited liability company or partnership. |
1.2 | “API” means American Petroleum Institute, a long-established petroleum industry organization. |
1.3 | “ASTM” means the American Society for Testing and Materials, a long-established source of standard testing and evaluation methods for petroleum. |
1.4 | “barrel” means 42 American bulk gallons at 60 degrees Fahrenheit (“DF”). |
1.5 | “BPTF” means Hawaiian Electric’s Barbers Point Tank Farm, a fuel receiving, storage and |
1.6 | “BTU” and “BTU content” means British Thermal Unit and refers to the standard assessment of Fuel’s gross heating value or gross heat content of Fuel determined in accordance with the test method specified in this Contract. |
1.7 | “business day” shall mean Monday through Friday, except for a day as to which physical locations of commercial banks in Honolulu, Hawaii are closed for business to the public due to a scheduled holiday. |
1.8 | “Certificate of Quality” or “Quality Certificate” means the formal document recording the Seller’s laboratory determination of quality and BTU content of a particular sample which represents a specific Delivery, said laboratory determinations having been performed in accordance with the test methods described herein. |
1.9 | “Commission” means the State of Hawaii Public Utilities Commission. |
1.10 | “Commission Approval Order” is defined in Section 2.2 below. |
1.11 | “Consumer Advocate” means the Division of Consumer Advocacy of the Department of Commerce and Consumer Affairs of the State of Hawaii. |
1.12 | “Contract” means this Supply Contract for LSFO, Diesel and MATS Fuel between Seller and Hawaiian Electric. |
1.13 | “day” or “days“ means a calendar day of 24 hours. |
1.14 | “Deliver”, “Delivery”, “Deliveries” or “Delivered” refers to the transfer of title or physical movement of Fuel by Seller and purchased by Hawaiian Electric. |
1.15 | “Delivery Status Against Ratable” means the calculated figure equal to cumulative Deliveries of Fuel as of a specific day in a month where said Deliveries for the month which includes the specified day less the cumulative Nominations on a Contract-to-date basis as of that same specific day in a month. |
1.16 | “DF” means degrees Fahrenheit. |
1.17 | “Diesel” means low sulfur diesel, of the quality specified herein, which may be blended with LSFO to produce MATS Fuel. |
1.18 | “DOT” means the Department of Transportation of the State of Hawaii and/or of the United States, as the case may be. |
1.19 | “Effective Date” is defined in Section 2.3 below. |
1.20 | “Extension” means any Contract term in addition to and after the Original Term, each of which is a consecutive 12-month period beginning January 1. |
1.21 | “Final Sample” is defined by the mode of delivery which is detailed in Section 6.4 below. |
1.22 | “Fuel” means singularly and collectively LSFO, Diesel, and MATS Fuel suitable for use as a boiler fuel of the quality specifications described herein. |
1.23 | “gallon” means a United States liquid gallon of 231 cubic inches at 60 DF. |
1.24 | “Governmental Authority” means any international, foreign, federal, state, regional, county, or local Person having governmental or quasi-governmental authority or subdivision thereof, including recognized courts of Law, or other body or entity of competent jurisdiction. |
1.25 | “G.S.V.” means gross standard volume in U.S. Barrels at 60 DF. |
1.26 | “Independent Inspector” means a qualified third-party petroleum inspection contractor acceptable to both Parties providing petroleum sampling, measurement and other services before, during and after a Delivery. |
1.27 | “Inter-island Supply Contract” means that certain Inter-island Supply Contract for Petroleum Fuels, dated February 18, 2016, by and between Hawaiian Electric Co., Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited, and Chevron U.S.A. Inc. (through its division Chevron Products Company). |
1.28 | “Law” means any law, decree, directive, judgment, order, decision, interpretation, enforcement, statute, code, ordinance, rule, regulation, treaty, convention or any action, direction or intervention or other requirement of any Governmental Authority. |
1.29 | “Line Displacement Stock” means Fuel Delivered (i) to displace Fuel from BPTF piping to Hawaiian Electric’s Kahe or Waiau pipelines during any shutdown of operations of such facilities for reasons including but not limited to emergency, inspection, repair, or maintenance; (ii) to heat up BPTF piping, Hawaiian Electric’s Kahe or Waiau Pipelines subsequent to any shutdown; or (iii) to be used as reasonably required for the use or operation of such facilities in order to facilitate the movement of Fuel into Hawaiian Electric’s tankage at BPTF, Kahe and Waiau. |
1.30 | “LSFO” means low sulfur fuel oil produced in conformity with the provisions of the quality specified herein. |
1.31 | “Marine Delivery” or “Marine Deliveries” means a Delivery of Fuel and/or the components thereof, including blendstock, all or part of which are Delivered by Seller from a marine vessel to Hawaiian Electric’s receiving and storage tanks. |
1.32 | “MATS Fuel” means a liquid-based fuel, namely LSFO proportionately blended with Diesel, intended by Hawaiian Electric to satisfy the Environmental Protection Agency’s MATS rules and regulations or any similar rules and/or regulations. |
1.33 | “month” means a calendar month. |
1.34 | “Nominated” and “Nomination” means the amount of Fuel specified by Hawaiian Electric to be sold and Delivered by Seller and purchased and received by Hawaiian Electric for a specified month. All Nominated volumes shall specify the type and quantity, including the ratio of LSFO and Diesel for MATS Fuel required. |
1.35 | “Original Term” is defined in Section 2.1 below. |
1.36 | “Person” means an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity. |
1.37 | “Party” and “Parties” are defined in the first paragraph above. |
1.38 | “Pipeline Blend” means a mixture of Seller’s Pipeline Fill and Fuel. |
1.39 | “Pipeline Delivery” or “Pipeline Deliveries” means a Delivery of Fuel and/or the components thereof, including blendstock, all or part of which are Delivered by Seller to Hawaiian Electric’s receiving and storage tanks at BPTF. |
1.40 | “Pipeline Fill” means the petroleum residing in the pipelines through which Seller makes Delivery of Fuel to Hawaiian Electric. |
1.41 | “Ratable” means a volume that is proportional, able to be rated or estimated. |
1.42 | “Representatives” of a Party shall mean the respective officers, directors, members, managers, employees, and agents of such Party or its Affiliates. |
1.43 | “Refinery” means Seller’s oil refining and related facilities located in the Barbers Point area of O’ahu, in Campbell Estate Industrial Park, Kapolei, Hawaii. |
1.44 | “Reverse Line Displacement” means an operation where Hawaiian Electric pumps Hawaiian Electric’s Fuel into the pipeline which Seller uses to Deliver Fuel to Hawaiian Electric in order to displace Seller’s Pipeline Fill. |
1.45 | “Specification” means the fuel quality specifications applicable to Fuel as described herein and stated in Exhibit A. |
1.46 | “Term” means the Original Term and any Extension(s). |
1.47 | “Terminalling Agreement” means that certain Fuels Terminalling Agreement, dated February 18, 2016, by and between Chevron U.S.A. Inc. (through its division Chevron Products Company) and Hawaii Electric Light Company, Inc. |
1.48 | “USD” means currency denominated in U.S. dollars. |
1.49 | “Year” means a calendar year. |
(1) | A change in the volume of an individual Pipeline Delivery, if such change is in excess of […] of the previously advised Delivery volume or a change in the |
(2) | A change in the date of an individual Delivery, if such change is greater than […] from the previously advised date. |
1. | Hawaiian Electric may reject Seller’s proposed […]upon providing Seller notice no later than […] from the receipt of Seller’s notification. |
2. | Seller may propose an alternate […] period, where such alternate shipment period is within five (5) days of the date of Seller’s first proposed […] day shipment period. Notice may be given by email or telephone. |
3. | Seller shall provide Hawaiian Electric the intended volume of Fuel to be Delivered to Hawaiian Electric via marine vessel subject to a variation of […] with respect to the actual physical volume Delivered and a proposed […]. Notices may be given by email or telephone. |
1. | Seller may Deliver LSFO, LSFO blendstock, MATS Fuel, MATS Fuel blendstock, or Diesel Fuel from Seller’s vessel into Hawaiian Electric’s BPTF. The volume of Seller’s Marine Delivery shall conform to the provisions of Section 3.3 herein unless |
2. | If requested by Hawaiian Electric and in order to verify proper line-ups and procedures, for the first Marine Delivery under the Term of this Contract, Seller’s control operator shall be present at Hawaiian Electric’s control room for the entire duration of the Marine Delivery, at no cost to Hawaiian Electric. For all subsequent Marine Deliveries and at Hawaiian Electric’s option and cost, Seller’s control operator shall be present at Hawaiian Electric’s control room for the entire duration of the Marine Delivery, or at Hawaiian Electric’s option, the control operator may be present only for the beginning and end of the Marine Delivery. […]. |
1. | Seller agrees to advise the Independent Inspector, prior to commencing a Marine Delivery of Fuel or any component thereof from Seller’s vessel, the API gravity and flash point in degrees Fahrenheit shown on the port of loading Quality Certificate representing the quality of said Fuel or component thereof. |
2. | In order to reduce the likelihood of Seller’s Marine Delivery of Fuel, Fuel blendstock, or component thereof resulting in quality problems occurring in Hawaiian Electric’s receiving tank(s), Seller agrees to test a volumetric weighted average composite of samples representative of the Fuel, Fuel blendstock or component thereof to be shipped to Hawaiian Electric’s receiving tanks (“Precautionary Sample”). The Precautionary Sample shall be drawn after the arrival of the vessel in Hawaii state waters, but prior to the commencement of the Marine Delivery, and shall be tested by Refinery’s laboratory. Seller agrees that should a pre-discharge computer blend simulation representing the quality of a volumetric weighted average mixture of the Precautionary Sample, components of the Marine Delivery in questions previously shipped to Hawaiian Electric’s receiving tanks and other Fuel, Fuel blendstock or components available to be shipped from the Refinery reasonably indicate the Marine Delivery in question will not conform to the quality specified in Exhibit A. Seller will instruct the vessel operator not to commence Delivery of its cargo to Hawaiian Electric’s receiving tanks without Hawaiian Electric’s express permission. |
3. | The quality and BTU content of the Fuel Delivered shall be determined on the basis of a volumetric weighted average composite of samples drawn from Hawaiian Electric’s receiving tank(s) in such manner as to be representative of the entire Marine Delivery (“Tank Final Sample”). The Tank Final Sample shall be divided and otherwise handled in accordance with the provisions of Section 6.4(c). |
4. | Quantity of the Fuel Delivered via a Marine Delivery shall be determined at the time of each Marine Delivery by gauging Hawaiian Electric’s tank(s) before and after pumping. Quantities sold and Delivered pursuant to this Section 6.1. shall be calculated in accordance with the current measurement standards adopted by industry, ASTM, API and other recognized standard-setting bodies as are applicable in the opinion of the Independent Inspector and shall be expressed in G.S.V., U.S. barrels at 60 DF. |
1. | A change in the volume of an individual Pipeline Delivery if such change […] of the previously advised Delivery volume; or |
2. | A change in the date of an individual Delivery, if such change is […]from the previously advised date; or |
3. | […]. |
1. | One part shall be provided to Seller’s laboratory for analysis to determine quality including BTU Content per barrel. |
2. | One part shall be provided to Hawaiian Electric for the purpose of verifying Seller’s determinations. |
3. | At least one part shall be sealed and provided to the Independent Inspector to be retained for a period of at least three (3) months. |
1. | The quality of Fuel sold and Delivered to Hawaiian Electric shall be determined on the basis of Seller’s Certificate of Quality of the Fuel provided by the Seller. Each shipment of Fuel to Hawaiian Electric shall comply with the Specifications subject to Section 4.1. |
2. | The official BTU Content determination shall be as reported in Seller’s Certificate of Quality, provided that the arithmetic difference between Seller’s and Hawaiian Electric’s laboratory results is equal to or less than the then existing ASTM reproducibility standard (currently 0.4 MJ/kg, which the Parties shall deem to be equivalent to a fixed standard of 60,000 BTU per barrel) for test D-240. If the difference between Seller’s and Hawaiian Electric’s determinations of BTU Content |
3. | If Seller or Hawaiian Electric has reason to believe that the quality of Fuel stated for a specific Delivery fails to conform to the Specifications in Article IV or the fuel specifications in Exhibit A, that Party shall within five (5) days after the later of the date of the completed Certificate of Quality or the date of the final determination of BTU Content, present the other Party with documents supporting such determination and the Parties will confer, in good faith, on the causes for the discrepancy and shall proceed to correct such causes and adjust the quality, if justified, for the Delivery in question. In the event of an unresolved difference between Seller and Hawaiian Electric, the sealed part of the representative sample in the possession of the Independent Inspector shall be provided to an independent laboratory for an official determination, which shall be final. Seller and Hawaiian Electric shall share equally the cost for such independent laboratory determination. |
4. | If the quality of the Fuel received by Hawaiian Electric fails to conform to the quality Specifications, both Hawaiian Electric and Seller shall attempt to minimize the impact of any quality problem. […]. Or, Seller may attempt to remedy the quality problem by Delivering higher quality Fuel in a timely manner to produce a Specifications quality blend in Hawaiian Electric’s storage tank(s) at Hawaiian Electric’s BPTF or at Hawaiian Electric’s O’ahu generating plants. If all such and similar efforts fail to resolve the quality problem, then Hawaiian Electric may return non-Specifications Fuel to Seller, in which case Seller shall replace the non-Specifications Fuel by Delivering an equal volume of Hawaiian Electric verified on-Specifications Fuel to Hawaiian Electric in a timely manner. Notwithstanding the preceding, Hawaiian Electric shall always have the right to refuse Delivery of any Fuel with prior written notice to Seller or its permitted agents if Hawaiian Electric in good faith shall have reason to believe that the Fuel does not meet the Specifications. […]. |
5. | All reasonable costs and expenses concerning testing, transportation, re-refining, and handling incurred in returning, replacing or otherwise correcting off-Specification Fuel shall be for the account of Seller. |
1. | Marine and War Risk Hull & Machinery coverage (including 4/4ths Collision Liability) subject to an Amount Insured not less than the full value of the vessel. |
2. | Full form Protection & Indemnity Insurance, including Excess Collision, pollution/ environmental risk coverage, upon the vessel pursuant to a standard Protection & Indemnity Club entry, with a Club which is a member of the International Group of Protection and Indemnity Clubs, with minimum limits for pollution/environmental risks to be [...] per occurrence or the maximum commercially available, whichever is greater. Such insurance shall cover all of the risks covered under a |
3. | Standard Workers Compensation and Employers Liability Insurance endorsed to be applicable to the State of Hawaii as well as the Longshore Act, with statutory limits for workers compensation and limits of [...] per occurrence for employers liability. |
4. | Commercial General Liability Insurance with a bodily injury and property damage combined single limit per occurrence of at least [...]. |
5. | Automobile Liability Insurance on all owned, non-owned and hired vehicles used in conjunction with the Delivery of Fuel to Hawaiian Electric with a bodily injury and property damage combined single limit per occurrence of at least [...]. |
6. | Other Coverage. Seller and anyone acting under its direction or control or on its behalf shall at its own expense procure and maintain in full force and effect at all times during the Term of this Contract on all owned, non-owned and hired vehicles used in conjunction with the Delivery of Fuel to Hawaiian Electric, any other insurance or surety bonding that may be required under the laws, ordinances and regulations of any governmental authority, including the Federal Motor Carrier Act of 1980 and all rules and regulations of the DOT and/or the USDOT. |
1. | a failure of performance of any Person other than one of the Parties (except to the extent that such failure otherwise would constitute a Force Majeure but for this exclusion); |
2. | any market, financial or economic conditions that are unfavorable for either Party; |
3. | the ability of a Party to obtain better economic terms from a third party or the inability to economically perform its obligations under any transaction undertaken pursuant to this Contract; or |
4. | an unexcused failure by a Party to pay any undisputed amounts due to a third party when due or to perform timely any obligations owed to a third party; and any event |
1. | The […] price will be […] with a […] of […] (owed by Hawaiian Electric to Seller on a […], beginning on the date immediately following the […] Termination […] and for the remainder of the Term. |
2. | Hawaiian Electric’s […] of […] will be in accordance with Seller’s requirements, including, but not limited to […] Seller will communicate the foregoing requirements to Hawaiian Electric within […] after Hawaiian Electric notifies Seller of it election to […] the […], and Seller will thereafter promptly advise Hawaiian Electric of any subsequent changes or additions to the requirements in view of the evolution of relevant […] standard or circumstances. |
3. | Hawaiian Electric is responsible for […] and its […] for […] arising out of or relating to […] of the […] |
4. | Hawaiian Electric will satisfy […] obligations under [… ] as a […] of […] for […] |
CHEVRON PRODUCTS COMPANY, a division of Chevron U.S.A. Inc | ||
Signature: | ||
/s/ Billy Liu | ||
Name: Billy Liu Title: Hawaii VCO Coordinator | ||
HAWAIIAN ELECTRIC COMPANY, INC. | HAWAIIAN ELECTRIC COMPANY, INC. | |
Signature: | Signature: | |
/s/ Jay Ignacio | /s/ Ronald Cox | |
Name: Jay Ignacio Title: Assistant Secretary | Name: Ronald R. Cox Title: Vice President, Power Supply |
Test Property | Test Method | Unit Of Measure | LSFO Fuel Min Max | |
Gravity @ 60 Degrees F. | ASTM D-4052 | Degrees API | 12 | 24 |
Viscosity | ASTM D-445, D-2161 | SSU at 210 DF | 100 | 450 |
Heat Value, Gross | ASTM D-240, D-4868 | MM BTU/BBL | 6.0 | |
Flash Point | ASTM D-93 | Degrees F. | 150 | |
Pour Point | ASTM D-97, D-5949 | Degrees F. | 125 | |
Ash | ASTM D-482 | Percent, Weight | 0.05 | |
Sediment & Water*** | ASTM D-1796 | Percent, Weight | 0.50 | |
Sulfur | ASTM D-4294 | Percent, Weight | 0.50 | |
Nitrogen | ASTM D-4629, D5762 | Percent, Weight | 0.50 | |
Vanadium | ASTM D-5863, AES, Oxford Test Method MDMET017 | PPM, Weight | 50.0 | |
Carbon Residue | ASTM D-4530 | Percent, Weight | […] |
Specification Item | Test Units | Diesel Fuel Limits | Test Method ** |
Gravity @ 60°F | API, Specific Gravity | 25.7 min., .9 max. | D1298 or D4052-86 |
Viscosity | @ 40C CST | 1.7 - 5.5 | D445, D2161 |
BTU content * | MM BTU/BBL | Report | Calculated or D240 |
Heat Value, Net* | MM BTU/BBL | Report | MM BTU/BBL |
Flash Point | PM°F | 140 min. | D93 or D6450 |
Pour Point * | °F | 35min | D97 |
Ash | PPM, wt. | 100 max. | D482 |
Cetane Index | 30 min. | D4737 | |
Carbon Residue, 10% Residuum | %, wt. | 0.35 max. | D524 |
Sediment & Water*** | %, vol. | 0.05 max. | D2709 |
Sulfur | %, wt. | 0.10 max. | D1552, D2622 or D4294 |
Distillation 90% Recovered | °F | 540 - 698 | D86 |
Water by Distillation*1 | PPM, wt. | Report | D95 |
Nitrogen* | PPM, wt. | Report | D5762 or D4629 |
1.1 | “Affiliate”, except where otherwise expressly provided, means an entity controlling, controlled by or under common control with Chevron or Hawaii Electric Light, as the case may be. For the purposes of this definition “control” (including with correlative meanings, “controlling,” “controlled by,” and “under common control with”) means the power to direct or cause the direction of the management and policies of such entity, directly or indirectly, whether through the ownership of a majority of voting securities, by contract or otherwise, and it being understood and agreed that with respect to a corporation, limited liability company, or partnership, control shall mean direct or indirect ownership of equal to or more than 50% of the voting stock or limited liability company interest or general partnership interest or voting interest in any such corporation, limited liability company or partnership. |
1.2 | “API” means American Petroleum Institute, a long-established petroleum industry organization. |
1.3 | “ASTM” means the American Society for Testing and Materials, a long-established source of standard testing and evaluation methods for petroleum. |
1.4 | “barrel” “BBLS” means 42 American bulk gallons at 60 degrees Fahrenheit (“DF”). |
1.5 | “BTU” and “BTU Content” means British Thermal Unit and refers to the standard assessment of Fuel’s gross heating value or gross heat content of Fuel determined in accordance with the test method specified in this Agreement. |
1.6 | “business day” shall mean Monday through Friday, except for a day as to which physical locations of commercial banks in Honolulu, Hawaii are closed for business to the public due to a scheduled holiday. |
1.7 | “Certificate of Quality” means the formal document recording the Chevron’s laboratory determination of quality and BTU content of a particular sample which represents a specific delivery, said laboratory determinations having been performed in accordance with the test methods described herein. |
1.8 | “Chevron Facility” means the Chevron’s Hilo, Hawaii Terminal, located at 666 Kalanianaole Ave., Hilo, Hawaii 96720. |
1.9 | “Commission” means the State of Hawaii Public Utilities Commission. |
1.10 | “Commission Approval Order” is defined in Section 2.2 below. |
1.11 | “Consumer Advocate” means the Division of Consumer Advocacy of the Department of Commerce and Consumer Affairs of the State of Hawaii. |
1.12 | “day” or “days” means a calendar day of 24 hours. |
1.13 | “Diesel” means No. 2 Diesel produced in conformity with the provisions of the quality in the Specification which are set forth herein. |
1.14 | “DOT” means the Department of Transportation of the State of Hawaii and/or of the United States, as the case may be. |
1.15 | “Effective Date” is defined in Section 2.3 below. |
1.16 | “Extension” means any Agreement term in addition to and after the Original Term, each of which is a 12-Month period beginning January 1. |
1.17 | “Fuel” means singularly and collectively Industrial Fuel Oil (“IFO”) and No. 2 Diesel (“Diesel”) meeting the Specifications described in Exhibit A. |
1.18 | “gallon” means a United States liquid gallon of 231 cubic inches at 60 DF. |
1.19 | “Governmental Authority” means any international, foreign, federal, state, regional, county, or local Person having governmental or quasi-governmental authority or subdivision thereof, including recognized courts of Law, or other body or entity of competent jurisdiction. |
1.20 | “Independent Inspector” means a qualified third-party petroleum inspection contractor acceptable to both Parties providing petroleum sampling, measurement and other services before, during and after a delivery. |
1.21 | “Inter-island Supply Contract” means that certain Inter-island Supply Contract for Petroleum Fuels, dated February 18, 2016, by and between Hawaiian Electric Co., Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited, and Chevron U.S.A. Inc. (through its division Chevron Products Company). |
1.22 | “Law” means any law, decree, directive, judgment, order, decision, interpretation, enforcement, statute, code, ordinance, rule, regulation, treaty, convention, or any action, direction or intervention or other requirement of any Governmental Authority. |
1.23 | “Line Displacement Stock” means Fuel used to displace or flush or move existing Fuel in a pipeline. |
1.24 | “LSFO Supply Contract” means that certain Supply Contract for LSFO, Diesel and MATS Fuel, dated February 18, 2016, by and between Hawaiian Electric Company, Inc. and Chevron U.S.A. Inc. (through its division Chevron Products Company). |
1.25 | “MATS Fuel” means Fuel that is compliant with the Environmental Protection Agency’s (“EPA”) rule to reduce emissions of toxic air pollutants from power plants, specifically Mercury and Air Toxics Standards (MATS). |
1.26 | “month” means a calendar month. |
1.27 | “Original Term” is defined in Section 2.1 below. |
1.28 | “Party” and “Parties” are defined in the first paragraph above. |
1.29 | “Person” means an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity. |
1.30 | “Pipeline Delivery” means a delivery of Product which is delivered by pipeline from the Chevron Facility to Hawaii Electric Light’s power plants. |
1.31 | “Product(s)” means Industrial Fuel Oil (“IFO”) and/or No. 2 Diesel (“Diesel”) which shall be stored, received, delivered or piped into and from the Chevron Facility. |
1.32 | “Representatives” of a Party shall mean the respective officers, directors, members, managers, employees, and agents of such Party or its Affiliates. |
1.33 | “Specification” means the fuel quality specifications applicable to Fuel as described herein and stated in Exhibit A. |
1.34 | “Term” means the Original Term and any Extension(s). |
1.35 | “Terminalling Services” means the receipt, storage, delivery, blending and handling of Hawaii Electric Light’s Products, as further described in Article III. |
1.36 | “Terminalling Services Fee” or [ … ] means the per barrel fee (set forth on Exhibit B) paid in exchange for Chevron’s storage and handling of fuel products which includes all associated services, Chevron Facility personnel costs, operations and maintenance, and any miscellaneous expenses, excluding taxes. |
1.37 | “Unavailable Day” means each 24 consecutive hour period during which Chevron is unable (other than due to the fault of Hawaii Electric Light) to provide any of the Terminalling Services including (but not limited to): (i) receive Products at the Chevron Facility and/or (ii) deliver Hawaii Electric Light’s Product at the Chevron Facility. |
1.38 | “USD” means currency denominated in U.S. dollars. |
1.39 | “year” means a calendar year. |
1. | Storage tanks shall be available for incoming barge deliveries of Product. |
2. | Subject to Section 7.1 and Section 7.2, Operators and Chevron Facility personnel shall be available for any and all incoming and outgoing Product receipts and deliveries, including loading of Hawaii Electric Light’s tanker trucks at the truck rack and the operation of the pipeline from the Chevron Facility to Hawaii Electric Light’s power plant(s). Once the barge unloading begins, the Chevron |
1. | Commercial General Liability Insurance (including but not limited to coverage for each Party’s obligation hereunder to defend and/or indemnify each Party) with limits of not less than [...] each occurrence and [...] general aggregate; CG 2503, or its equivalent, amending aggregate limits shall apply. |
2. | Business Automobile Liability Insurance covering all vehicles used by each Party in their operations with a limit of liability of not less than: [...] each occurrence for bodily injury and property damage combined, such policy to be endorsed with MCS-90 and CA 99 48, or its equivalent, when hazardous material transportation is involved. |
3. | Workers’ Compensation Insurance and/or Longshoremen’s and Harbor workers’ Compensation Insurance as required by laws and regulations applicable to and covering employees of each Party performing under this Agreement. |
4. | Employers’ Liability Insurance protecting each Party against common law liability, in the absence of statutory liability, for employee bodily injury arising out of the master-servant relationship with a limit of not less than [...] Each Accident, [...] Disease-Policy Limit, [...] Disease-Each Employee. |
1. | a failure of performance of any Person other than one of the Parties (except to the extent that such failure otherwise would constitute a Force Majeure but for this exclusion); |
2. | any market, financial or economic conditions that are unfavorable for either Party; |
3. | the ability of a Party to obtain better economic terms from a third party or the inability to economically perform its obligations under any transaction undertaken pursuant to this Agreement; or |
4. | an unexcused failure by a Party to pay any undisputed amounts due to a third party when due or to perform timely any obligations owed to a third party; and any event described in Section 13.4 (which shall instead be addressed in accordance with Section 13.4). |
CHEVRON PRODUCTS COMPANY, a division of Chevron U.S.A. Inc. | |
Signature: /s/ Billy Liu ___________________________________ Name: Billy Liu Title: Hawaii VCO Coordinator | |
HAWAII ELECTRIC LIGHT, INC. | HAWAII ELECTRIC LIGHT, INC. |
Signature: /s/ Jay Ignacio ___________________________________ Name: Jay Ignacio Title: President | Signature: /s/ Tayne Sekimura ________________________________________ Name: Tayne Sekimura Title: Sr. VP & Chief Financial Officer |
Item | Units | Specification Limits | Test Method | |||
Gravity @ 60°F | °API, Specific | 30.0 min., .88 min. | D1298 or D4052-86 | |||
Viscosity @ 100 DF | SSU | 32.3 - 40.0 | D445, D2161 | |||
BTU content * | MM BTU/BBL | 5.84 | Calculated or D240 | |||
Heat Value, Net | MM BTU/BBL | Report | Calculated or D240 | |||
Flash Point, PM | °F | 150 min. | D93, D6450 | |||
Pour Point * | °F | 35 | D97 | |||
Ash | PPM, wt. | 100 max. | D482 | |||
Cetane Index | 40 min. | D4737 | ||||
Carbon Residue, | ||||||
10% Residuum | %, wt. | 0.35 max. | D524 | |||
Sediment & Water | %, vol. | 0.05 max. | D1796 | |||
Sulfur | %, wt. | 0.40 max. | D1552, D2622 or | |||
D4294 | ||||||
Distillation | ||||||
90% Recovered | °F | 540 - 650 | D86 | |||
Sodium+Potassium | PPM, wt. | 0.5 max. | D3605 | |||
Sodium+Pot+Lithium | PPM, wt. | Report | D3605 | |||
Vanadium ** | PPM, wt. | 0.8 | D3605 | |||
Nitrogen *** | PPM, wt. | 120 | D4629 or D5762 |
Item | Specifications | ASTM Test Method | ||
Gravity @ 60°F, API | 6.5 min. | D1298 or D4052-86 | ||
Flash, °F | 150 min. | D93, D6450 | ||
Viscosity, SSF @ 122°F | 179 min., 226 max. | D445/D2161 | ||
Pour Point, °F | 55 max. | D97 | ||
Sulfur, % Wt. | 2.00 max | D1552, D2622 or D4294 | ||
Sediment & Water, % Vol. | 0.5 max. | D1796 | ||
BTU content *, MM BTU/BBL | 6.0 | D240 | ||
Vanadium **, PPM wt. | 100 | D5863 | ||
Nitrogen ***, PPM wt. | 6500 | D5762 or D4629 |
Date: September 26, 2016 | |
/s/ Constance H. Lau | |
Constance H. Lau | |
President and Chief Executive Officer |
Date: September 26, 2016 | |
/s/ James A. Ajello | |
James A. Ajello | |
Executive Vice President and Chief Financial Officer |
Date: September 26, 2016 | |
/s/ Alan M. Oshima | |
Alan M. Oshima | |
President and Chief Executive Officer |
Date: September 26, 2016 | |
/s/ Tayne S. Y. Sekimura | |
Tayne S. Y. Sekimura | |
Senior Vice President and Chief Financial Officer |