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Home My WebLink About10 - Oil Well Service RepairCITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. 10 October 14, 2008 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Utilities Department Steve Myrter, Utilities Director (949) 718 -3400, smyrter@city.newport-beach.ca.us SUBJECT: OIL WELL SERVICE REPAIRS — APPROVAL OF AMENDMENT NO. 2 TO PROFESSIONAL SERVICES AGREEMENT RECOMMENDATION: Approve Amendment No. 2 to Professional Services Agreement with Oil Well Service Company for emergency on -call oil repair services and authorize the Mayor and City Clerk to execute the Amendment. DISCUSSION: On November 27, 2007, the City Council approved a Professional Services Agreement (PSA) with Oil Well Service Company, to provide. as needed on -call oil well repair services. Due to the pricing volatility of the oil industry, Oil Well Service Company was only able to guarantee time and material prices in six months intervals when this agreement was executed. On April 8, 2008, the City Council approved Amendment No. 1 to the PSA which incorporated a revised rate sheet and extended the contract term an additional six months. This proposed Amendment No. 2 incorporates a revised rate sheet reflecting current market prices as shown per attached Exhibit B and locks in prices through April 9, 2009. Through this on -call emergency agreement, Oil Well Service Company will provide specialized professional oil well services including: repair of oil and gas well casing, tubing, repair and replacement of oil production pumps and appearances, and well rehabilitation services at the City's Oil Field. Environmental Review: This action requires no environmental review, as it is not a project pursuant to CEQA. Oil Well Repair Services — Approval of Amendment No. 2 to Professional On -Call Service Agreement October 14, 2008 Page 2 Funding Availability: Funding is available in 5400 -8160 Maintenance & Repair. Expenditures more than $30,000 for an individual repair project will require a separate City Council action in accordance with Policy F -14. Submitted by: Steve Myrter, P. . Utilities Director Attachments: Amendment No. 2 with Oil Well Service Company AMENDMENT NO. 2 TO PROFESSIONAL SERVICES AGREEMENT WITH OIL WELL SERVICE CO. FOR ON -CALL OIL WELL REPAIR SERVICES THIS AMENDMENT NO. 2 TO PROFESSIONAL SERVICES AGREEMENT, entered into this 14th day of October, 2008, by and between the CITY OF NEWPORT BEACH, a municipal corporation, (hereinafter referred to as "City ") and OIL WELL SERVICE CO., a California Corporation whose address is 1241 Burnett St., Signal Hill„ CA 90755 ( "Contractor"), and is made with reference to the following: RECITALS A. On November 271h, 2007, CITY and CONTRACTOR entered into an On- Call Professional Services Agreement, hereinafter referred to as "Agreement", for Oil Well Repair Services. This Agreement is scheduled to expire on April 9th, 2008. B. On April 8th 2008, City and Contractor entered into an Amendment No. 1 to extend the term of the Agreement to October 9th, 2008. C. City desires to enter into this Amendment No. 2 to extend the term of the Agreement to April 9th, 2009. D. City and Contractor mutually desire to amend Agreement, hereinafter referred to as "Amendment No. 2 ", as provided here below. NOW, THEREFORE, the parties hereto agree as follows: 1. Contractor shall perform various oil well repair services pursuant to this Amendment No. 1 and according to the Request to Extend On -Call Services Agreement dated September 22, 2008, attached hereto as Exhibit A. 2. Compensation to the Contractor for services performed pursuant to this Amendment No. 1 for all work performed from October 9, 2008, to April 9, 2009, shall be based on the attached Schedule of Billing Rates (Exhibit B). 3. The term of the Agreement shall be extended to April 9, 2009. 4. Except as expressly modified herein, all other provisions, terms, and covenants set forth in Agreement shall remain unchanged and shall be in full force and effect. IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 2 on the date first above written. APPROVED AS TO FORM: By: .--- Aaron C. arp, Assistant City Attorney for the City of Newport Beach ATTEST: 0 LaVonne Harkless, City Clerk CITY OF NEWPORT BEACH A Municipal Corporation Edward Selich, Mayor for the City of Newport Beach OIL WELL SERVICE CO. M Title: President Print Name: am (Financial Officer) Print Name: Attachment: Exhibit A — Request to Extend On -Call Services Agreement . Exhibit B — Schedule of Billing Rates OIL WELL �� LONG BEACH (562) 5954501 BAKERSFIELD (661)746.4809 COALINGA (559) 935 -5080 SANTA PAULA (805) 525 -2103 WOODLAND (530) 662 -9384 September 22, 2008 Cindy Asher Newport Beach P.O. Box 1768 Newport Beach, CA 92658 -8915 Dear Cindy Asher, EXfIIBIf "A" Co. 1241 E. BURNETT STREET • SIGNAL HILL, CALIFORNIA 90755 -3594 SPP 2,t; ii Recnitr d �p Uiifities P C' This is to inform you that Oil Well Service Co. has been in business since 1940 and is 100% owned by our Employee Stock Ownership Trust. Our current office yard address is, 1241 E. Burnett St. Signal Hill, CA 90755. We plan to hold the prices in the attached price list for the next six months. Feel free to give us a call if you have any questions. Sincer ack Frost Oil Well Service General Manager EXHIBIT "B" C:IL WELL SLRVIG� CO. PRODUCTION EOUIPM + NT DOUBLE RIGS - 90' -95', 180,000 - 212,000# CAPACITY 166.00 PERM SINGLE RIG SKID RIGS 125.00 PER HR RIG STANDBY RATE ) (WHEN SHUT -DOWNS ARE BEYOND OUR CONTROL 175.00 PER TAR 1050.00 PER DAY TOOL TRUCK -WITHOUT RIG FISHING TOOLS 10000 PERM DAMAGED FISHING TOOLS - CHARGED TO CUSTOMER 125.00 PERRUN SANDLINE CHARGE: Q'-5,000, UM 120.00 PER DAY O OVER 55,, 000' 50.00 PER HR ADDITIONAL CHARGE FOR BAILING OR SWABBING IN CORROSIVE 75.00 PERM ENVIRONMENT (B2S ACID ETC.) CONTRACT LABOR AND TRAVEL Too TO AND FROM. THE JOB SITE FOUR MEN CREW THREE MEN CREW 418.00 PER HR HEAD WELL PULLER 343.00 PER HR HELPER 140.00 PER HR DOUBLE TIME SURCHARGE 3 MEN CREW 113.00 PER H(t DOUBLE TIME SURCHARGE 4 MEN CREW 145.00 PBRHR EXTRA SUPERVISION 173.00 PER HR SUBSISTENCE AWAY FROM HOME PER MAN 1250.00 PER DAY 150.00 PER DAY DOUBLE TRdE WILL BE CHARGED FOR CREWS WORKING ON THE FOLLOWING LEGAL HOLIDAYS: MEMORIAL DAY, JULY 4TH, LABOR DAY, THANKSGIVINCs, CHRISTMAS AND NEW YEARS DAY MINIMUM DAY, FOUR HOURS RIG AND CREW 41L WELL SER-W RELATED EQUIPMENT TRIPLEX PUMP WITH SHAKER TANK AND 2 HOSES DUPLEX PUMP WITH SHAKER, TANK AND 2 HOSES 1200.00 PER DAY STANDBY RATE WHEN PUMPS ARE NOT USED 1050.00 PER DAY GENERATOR 300.00 PER DAY HYDRAULIC POWER SWIVEL 100.00 PER DAY STANDBY RATE WHEN NOT USED 900.00 PER DAY OPERATOR REQUIRED FOR ALL ABOVE EQUIPMENT WHEN NOT USED IN 300.00 PER DAY CONIIINCTION WITH O.W.S. RIGS H.T. PRODUCTION SWIVEL 90.00 PER HR 2" X 50'2000 PSI KELLY HOSE (EXTRA HOSES) 100.00 PER DAY PORTABLE HYDRAULIC UNIT 100.00 PER HOSE OIL WELL SERVICE CO. TRANSPORTATION 250.00 PER DAY ELECTRONIC SINGLE GAS 112S MONITOR 100.00 PER HR ELECTRONIC 4-WAY MONITOR 100.00 PER DAY 30 MIN S.C.B.A. AIR PACK 175.00 PER DAY ACID PACKAGE, INC. (GOGGLES, RUBBER RAIN SUIT, RUBBER 1$0.00 PER DAY GLOVES) CELLAR PUMP 75.00 PER MAN HYDRAULIC MANIFOLD 80.00 PER DAY EXTRA CHARGE FOR CELLAR RINGS AND RIG MATS 85.00 PER DAY WATER TRAILER 60.00 PER DAY SUPPLIES AND RENTAL EQUIPMENT FROM OTHER SOURCES WILL HAVE 15% ADDED FOR PROCESSING. SHAKER BOX 50.00 DAY WELDER PLASTIC 100.00 HR 100.00 ROLL ' ADDITIONAL CHARGES FOR DISPOSAL OF SOLIDS AND FLUIDS FROM MUD PUMPS S IF A WAIVER OF SUBROGATION IS REQUIRED AN ADDITIONAL CHARGE OF $2.50 PER CREW HOUR WILL, BE ADDED FUEL SURCHARGE k FUEL WILL BE BASED ON AVERAGE BEFORE TAX COST OF 1.05 PER GALLON EACH RIG USES 6 GALLONS PER HOUR EACH 1 CENT INCREASE IN FUEL PRICE OVER LAST YEARS RATE WILL RESULT IN A 6 CENT PER HOUR SURCHARGE. OIL WELL SERVICE WJLL CALCULATE FUEL COSTS AT THE END OF EACH MONTH IN ORDER TO DETERMINE THE NEXT MONTHS CHARGES. THIS JUNE 1ST, 208 LIST SUPERSEDES ALL PREVIOUS PRICES QUOTED