CITY OF BRENHAM GAS PROVIDER CLAIMS CITY BREACHED CONTRACT DURING WINTER STORM URI

  
Winter Storm Uri in February covered downtown Brenham in snow and led to power and water outages for residents across the state. (Mark Whitehead)

The City of Brenham’s gas provider alleges the city breached its contract during Winter Storm Uri in February, and is seeking over $1 million in damages.

Amidst an ongoing legal battle between the city and WTG Gas Marketing in 335th District Court, the gas company claims that the city violated an emergency order issued by the Railroad Commission of Texas (RRC) on February 12th by delivering “excessive amounts of gas to its industrial customers, at WTG’s expense.”

The order, which remained in effect until February 23rd, specified that the transportation, delivery or sale of natural gas should be reduced unless serving human needs customers.  WTG alleges that Brenham’s action was “a violation of the emergency order to the extent that industrial users were served before all human needs customers,” and as a result was a breach of the gas sales contract between the two entities.

WTG claims that it arranged for Brenham to receive the gas it needed to satisfy human needs, through WTG’s gas delivery agreement with Oasis Pipeline.  However, the company says it was “forced to purchase, ship and supply the industrial volumes of unusually expensive gas that Brenham was illegally causing to be distributed, delivered and/or sold for industrial end-use.”

The company is seeking monetary relief in excess of $1 million, along with recovery of attorneys fees and expenses incurred as a result of Brenham’s “misconduct.”

WTG’s counterclaim does not specify how much gas was delivered to industrial users or to human needs customers during the period of the emergency order.

In a response to the counterclaim, the city says WTG’s assertions are devoid of any fair description of alleged damages, instead providing “a smattering of obscure and general statements.”  The city states it is left to speculate what the nature is of the damages WTG alleges and seeks.

The city and WTG remain embroiled in a lawsuit after the city claims the company did not honor its existing gas sales contract, which has been in place since 2016 and sets a price at the first of each month.  According to a motion for partial summary judgment filed by the city in August, the city claims WTG ignored the first-of-the-month pricing provision from February 12-23, substituting for daily rates that the contract did not allow.  The city says WTG is attempting to charge the city $8.07 million for gas delivered during the month of February, and claims that the total bill should have instead been $271,502.

In the city’s motion, it disputes WTG’s claims that its pricing was justified based on the contract’s force majeure provision, which says the seller shall not be liable to the buyer for its failure to deliver gas, as the city claims the provision only applies when gas is not delivered.  It also says WTG asserted it could charge daily rates because of penalties charged against WTG by Oasis Pipeline; the city states WTG cannot charge Brenham for any alleged penalties incurred in a separate contract.

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7 Comments

  1. I was wondering why i had 4 charges for gas on my utility bill. Not only do i pay for the gas i actually use, i pay a second amount im assuming to reimburse the city for what they spent, i pay a third amount to apparently cover maintenance cost even tho i havent even had someome inspect the lines in the 15 yrs ive been using gas. Then there is a 4th charge or fee or cost that has nothing to do with my home and the actual gas i used during the month….i dont know about everyone else, but im sick n tired of it all. To be honest, the residents are getting screwed, the customer should be responsible for the amount of fuel they use, period. Its become common business practices for fees and costs to be tacked on in order to cover some operating expense and its unethical and borderline larceny. Customers should be considered “investors” or “shareholders” if thats the case…..just sounds like the citizens will end up paying for some suit in an office’s poor decision or greed or both…..

  2. The city of Brenham pays three different city managers and a city attorney over one million dollars a year. The tax payers deserve a lot more than this for their tax dollars. The tax payers cannot afford to pay for gross mistakes and costly errors from the three city managers and city attorney. The mayor and council will be guilty too if they fail to fire the whole clan for their gross misconduct and unacceptable negligence. Their Ignorance is no excuse, it just supports their incompetence.

    1. Exaggerate much??? Over a million dollars? Think the City Manager makes about $160,000. . .I’m sure the assistants and attorney make less. High salaries, sure, but nowhere close to “over a million dollars.”

  3. Would not surprise me if the city did this and tried to cover it up. Now it will be left with the taxpayers to cover. The whole city management and council needs to change. All this trouble the city has had within the last year or two with all the lawsuits against them-Guyton-Boeker and now this gas company.

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