“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topic. In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails.” Extension of Franchise Agreement
with Zenith Energy West Coast
Terminals LLC for 25-Year Term
Erika King
Senior Management Analyst
July 16, 2024
2CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topic. In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails.” • Zenith Energy West Coast Terminals LLC (Zenith)
operates a pipeline carrying petroleum products
between Southern California Edison (SCE) facilities.
• A Franchise Agreement has been in place between the
City and Zenith (or its predecessors) since 1967.
• Current Agreement set to expire on August 19, 2024.
• Under the franchise, Zenith may conduct, transport,
convey or carry gas, oil, petroleum products, water, and wastewater through the City within its pipeline.
• The pipeline is 8,333 feet long.
BACKGROUND
JULY 16, 2024
EXTENSION OF FRANCHISE AGREEMENT WITH ZENITH ENERGY WEST COAST TERMINALS LLC 3CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topic. In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails.” JULY 16, 2024
EXTENSION OF FRANCHISE AGREEMENT WITH ZENITH ENERGY WEST COAST TERMINALS LLC
ZENITH PIPE LOCATIONS
Elm Av e .
4CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topic. In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails.”
FRANCHISE AGREEMENT TIMELINE
JULY 16, 2024
EXTENSION OF FRANCHISE AGREEMENT WITH ZENITH ENERGY WEST COAST TERMINALS LLC Entity Date Event
Southern California
Edison (SCE) April 19, 1967
Initial Pipeline Franchise
Agreement approved by
City Council
SCE July 20, 1999
Granted new 25-year
Agreement (Ordinance
No. 2002) by City Council
Pacific Terminals LLC August 2003 Assigned rights from SCE Plains West Coast
Terminals LLC June 2009 Name change from
Pacific Terminals LLC
Zenith Energy West
Coast Terminals LLC
(Zenith)
October 2020 Name change from Plains
West Coast Terminals LLC
Zenith 2024 (Pending) Request for 25-year
franchise extension
5CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topic. In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails.” Two ordinances have been prepared for
City Council consideration:
1) Urgency Ordinance No. 24-0007-U, if
adopted, becomes effective
immediately
2) Regular Ordinance No. 24-0007 that
requires a first and second reading
and becomes effective 30 days after
the second reading on August 6, 2024.
DISCUSSION
JULY 16, 2024
EXTENSION OF FRANCHISE AGREEMENT WITH ZENITH ENERGY WEST COAST TERMINALS LLC 6CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topic. In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails.”
FRANCHISE TERMS AND CONDITIONS
JULY 16, 2024
EXTENSION OF FRANCHISE AGREEMENT WITH ZENITH ENERGY WEST COAST TERMINALS LLC Franchise Agreement Compliance
• Grantee must adhere to the Municipal Code, Franchise
Act of 1937, and ordinance terms
• Payment per Public Utilities Code Section 6231.5 over 25-years
Performance and Insurance
• Posting of a performance bond
• Insurance with City as additional insured
Legal Protections for the City
• Indemnification against franchise-related claims
• Written acceptance of terms by Grantee
7CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topic. In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails.” Staff recommends that the City Council:
1) Conduct a Public Hearing;
2) Find the proposed action categorically exempt from
environmental review pursuant to the California
Environmental Quality Act (CEQA);
3) Adopt Urgency Ordinance No. 24-0007-U granting an
extension of an existing franchise agreement to Zenith
Energy West Coast Terminals LLC for a 25-year term; and 4) Introduce Ordinance No. 24-0007 granting an extension of an existing franchise agreement to Zenith Energy West Coast Terminals LLC for a 25-year term.
STAFF RECOMMENDATION
JULY 16, 2024
EXTENSION OF FRANCHISE AGREEMENT WITH ZENITH ENERGY WEST COAST TERMINALS LLC