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Gas Pipelines Oppose Antidumping Petition

Gas Pipelines Oppose Antidumping Petition

A major gas pipeline group has asked the federal government to reject a producer petition that seeks to have tariffs imposed on crude oil imports from four foreign countries accused of illegal dumping.

The board of directors of the Interstate Natural Gas Association of America (INGAA) passed a resolution last week urging the Commerce Department and International Trade Commission (ITC) to dismiss the pending petition to have tariffs assessed on imports from Mexico, Venezuela, Saudi Arabia and Iraq. A coalition of independent domestic producers, called "Save Domestic Oil," filed the petition in an attempt to stop the foreign producers from allegedly dumping oil in the United States.

"This petition sends the absolute wrong signal at a time when Mexico is opening its gas markets to U.S. investment," said INGAA President Jerald Halvorsen in a prepared statement accompanying the pipeline group's resolution. In response to the petition, the Mexican government has refused to remove a 4% tariff on natural gas imported into its country. The tariff was scheduled to be lifted July 1st.

INGAA said it was particularly concerned about the potential effect of oil tariffs on the "extensive investments and expansion plans" of its member companies in Mexico, Venezuela and Saudi Arabia. These would be "impacted negatively by reduced market access and petroleum products to the United States and a resulting delay in implementation of market-opening initiatives," such as with Mexico's gas market, according to INGAA's resolution.

Although "sympathetic to the difficult situation" facing domestic independent producers, INGAA said it believes that historically low world energy prices are to "blame for their plight" rather than the actions of Mexico, Venezuela and Saudi Arabia. It called on the Clinton administration and Congress to take measures - aside from granting the petition - to "assist the domestic oil and gas industry with special consideration given to small producers."

Exxon Corp., as well as other major producers, put in its two cents also, calling on the U.S. government to reject the antidumping complaint. "Exxon is opposed to misguided requests for government protections to shield U.S. producers from the rigors of this competition and business climate," Chairman Lee R. Raymond said in a letter to Commerce Secretary William M. Daley.

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