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Item 4JCity of Southlake, Texas M E M O R A N D U M June 5, 2007 To: Shana Yelverton, City Manager From: Robert H. Price, P.E., Public Works Director Subject: Approve an agreement with Premier Chemicals, L.L.C. to provide odor control treatment at lift stations Action Requested: Approve an agreement with Premier Chemicals, LLC to provide odor control treatment at lift stations. Background Information: Since the construction of the Shady Lane and Lonesome Dove Sanitary Sewer Lift Stations in 2000 the city has spent approximately $65,000 per year to prevent Hydrogen Sulfide production in the sewer system affecting the residents of the Kirkwood Hollow neighborhood. Because the old technology was failing to produce acceptable results staff found another treatment process which has been in place on a trial basis since the middle of April. Because of the successful performance during the last year, staff is recommending that council accept the proposal offered by Premier Chemical, LLC to guarantee a rate for their services for a 12-month period with an estimated annual cost of approximately $60,000.00. Premier Chemical is a sole source provider of this technology. An additional benefit to this technology is the prevention of grease buildup in the lifts stations eliminating the need for City crews to remove and dispose of excess grease. Financial Considerations: Funding for this item in the amount of $65,000 is available in the current operating budget. Citizen Input/ Board Review: None Legal Review: None. Alternatives: The City Council may approve or deny this agreement. Supporting Documents: Agreement Sole Source (Patent) Documentation Staff Recommendation: Approve an agreement with Premier Chemicals, LLC to provide odor and corrosion control treatment in the sanitary sewer collection system. Staff Contact: Robert H. Price, P.E., Public Works Director Chuck Kendrick, Deputy Director of Public Works - Operations April 30, 2007 Chuck Kendrick Public Works Operations Manager City of Southlake Phone (817) 748-8080 Fax (817) 748-8103 ckendrick@ci.southlake.tx.us Re: Annual Contract Pricing Renewel Chuck: Pursuant to your request for a renewal of the annual contract for Thioguard, I am submitting this letter to outline the original terms of agreement. You can submit Purchase Orders on a per load basis, or a Blanket PO for the duration of the price in effect. Pricing after the term noted may change due to changes in production costs, freight, etc. Please note, annual usage may go up as a result of increased flows through the treated Southlake system, since we currently feed proportionally to flow. Prior to the previous contract year, flows were estimated at 0.7 mgd. Please adjust accordingly if flows have changed. Expected Thioguard Costs Dosing: Product dosages may range from 40-95 gallons of Thioguard per million gallons of wastewater treated. An initial dosage rate is calculated by taking the total dissolved sulfide measurement and multiplying by 1.7. In this case, a range of 10-25 mg/L dissolved sulfides measured at the Lonesome Dove and Shady Lane FM discharge times 1.7 would equate to an initial dosage of 17-42.5 gallons of Thioguard per MGD of wastewater to be treated. Additional Thioguard is added to account for certain wastewater factors such as initial pH, FOG, CO, retention time and desired HS gas odor/corrosion results. On a daily 22 0.7 basis, we are estimating 40-70 gallons of Thioguard consumed per day for the mgd treatment lines associated with the Lonesome Dove and Shady Lane LS. THIOGUARD: $2.35/gallon delivered to Southlake Truckload of material (~3,650 gallons of Thioguard) Valid: 7/1/2007 – 6/30/2008 Estimated Annual Cost (at max dosage): $60,042.50 On an annual basis, at a maximum dosage rate of 100 gallons of Thioguard per mgd of wastewater treated, total cost is estimated at 70 gpd x $2.35 x 365 = $60,042.50, although the maximum dosage rate may not be necessary to obtain the desired results. NOTE: The figures contained herein are based on approximate dosing schedules, as actual consumption rates are typically verified during the trial period. In the absence of a trial, actual consumption rates can only be determined during an initial adjustment period. The price per gallon is based on the following assumptions: Two feed locations (Lonesome Dove LS, Shady Lane LS) Feed unit configuration allowing full-truckload deliveries 13325KingmanDr.Austin,TX78729|O:512-331-4368|F:512-996-8461 13325KingmanDr.Austin,TX78729|O:512-331-4368|F:512-996-8461 http://www.premierchemicals.com | mmadolora@premierchemicals.com http://www.premierchemicals.commmadolora@premierchemicals.com Premier will provide: Storage tank/feed units appropriate for designed dosing requirements (Premier retains ownership of all Thioguard feed equipment unless specifically purchased by Southlake Parts/Labor for regular interval maintenance Material (Thioguard) Data collection (w/ assistance from Southlake) Reporting of Data Analysis Requirements – To be provided by Southlake SITE PREPARATION Level firm pad to set the Thioguard feed units in place (a level gravel pad formed using 2x6 lumber 10x10 is adequate) Boom truck or backhoe (w/ operator) to unload Thioguard equipment. (Approximate weight empty = 2,500 lbs; approximate weight loaded = 37,000 lbs) ELECTRICAL 230/460 3-phase 20 amp disconnect located near the Thioguard units o Contact closure indicating when lift station pumps are running, where applicable o 4-20 ma output signal indicating lift station pump speed for VFD stations or variable o metered flow conditions WATER Fresh-water hose bib o FEED POINT Premier designated access point for Thioguard feed injection o ACCESS Unencumbered access to feed units: key to gate and doors with unlimited hours of o access DELIVERIES Adequate access and safety for delivery by tanker truck. o TRIAL COMPLETION Cleanout of equipment upon completion of trial in preparation for pick-up by o Premier Proposal Acceptance: _________________________________ ________________________ Signature Print Name _________________________________ ________________________ Title Date Please do not hesitate to call if you have any questions or require additional information. I look forward to working with you and Southlake. Sincerely, Matt Matthew Madolora Premier Chemicals THIOGUARD 13325KingmanDr.Austin,TX78729|O:512-331-4368|F:512-996-8461 13325KingmanDr.Austin,TX78729|O:512-331-4368|F:512-996-8461 http://www.premierchemicals.com | mmadolora@premierchemicals.com http://www.premierchemicals.commmadolora@premierchemicals.com 850 First Avenue King of Prussia PA 19406 Tel: (610) 962-8954 Fax: (610) 962-8958 February 6, 2006 Teresa Dryer Department of Public Works 1950 E. Continental Blvd. Southlake, Texas 76092 Re: Premier Chemicals, LLC’s THIOGUARD® Magnesium Hydroxide Slurry Proposal to City of Southlake Dear Ms. Dryer, I have been asked to provide you a brief description of the claim coverage for U.S. Patent No. 5,833,864, entitled METHOD FOR THE REDUCTION AND CONTROL OF THE RELEASE OF GAS AND ODORS FROM SEWAGE AND WASTE WATER, (the "'864 Patent"). The patent relates to using magnesium oxide or hydroxide to control odor in municipal sewerage or wastewater. The '864 Patent includes 26 claims directed towards controlling odor in sewers by adding magnesium hydroxide or magnesium oxide. For example, claim 1 broadly claims controlling odor in municipal sewerage or wastewater that includes at least one compound which can be reduced to form hydrogen sulfide. Odor is controlled by simply adding an effective amount of magnesium hydroxide or magnesium oxide to the municipal sewerage or wastewater. I have included a copy of the patent with this letter. Premier has spent a great deal of effort, research, time, trial and error, as well as significant funds, in order to obtain the patent rights described above and to develop a product of the quality that our customers require. We believe the efforts expended to obtain such patent is indicative of the effort our Company will put forward to insure the City of Southlakewill receive a competitive, efficient and high quality product that will produce superior results. I hope that this helps in your understanding of Premier’s patent position, however, if you wish to discuss the enclosed or have any questions please do not hesitate to contact me. SOUTHLAKE THG PATENT LTR. Very truly yours, Stephen A. Becker Vice President, General Counsel and Secretary cc: P. Ahl R. Chase M. Madalora T. Miller SOUTHLAKE THG PATENT LTR.