NGSA, API in Tug of War Over Industry Representation
Negotiations reportedly are on going to bring together once
again the Washington lobbying activities of large oil and natural
gas producers in the form of the American Petroleum Institute (API)
and the Natural Gas Supply Assoc. (NGSA).
API announced in early May that as part of a major
reorganization plan it intended to establish a natural gas
component, one of six components including upstream, downstream,
pipeline, marine and allied services. At the time a spokesman said
the group was not targeting members of current natural gas
associations. He did say, however, that with the restructuring
members could restrict activities to one or more components and pay
dues for maintaining just that segment. Lower dues would allow it
to attract medium-to-small sized companies.
But last week new API Chairman Red Cavaney responded to a
question at a press briefing on the organization's restructuring
saying API's role in the natural gas arena will be "additive." He
mentioned synergies and pointed out that while NGSA has been very
active in regulatory affairs, API tends to be more an upstream
API so far has concentrated on downsizing and has not named
anyone to head its natural gas segment. That segment conceivably
could aim more toward the statistical and research side of natural
gas which has been malnourished. Sources say the organization has
inserted itself into the Natural Gas Council, and an API management
committee reportedly is studying the question of natural gas
activities, which could be brought up at the group's annual meeting
In the past, API's most prominent members have been large
integrated oil companies with an international focus. And in fact,
NGSA was spun off by those members in 1965 to pursue deregulation
of domestic natural gas. Those who would fold it back into API say
there is not enough activity on the current environmental, royalty
and electric restructuring issues to justify a separate natural gas
NGSA has been downsized and had its budget cut, as have all the
gas associations. Some say that budget of about $2 million has
reached the vanishing point for running an effective lobbying
effort in the nation's capital. API's 1997 budget was more than $58
million, but will be decreasing in 1999 by 10-15%.
Those who favor maintaining NGSA as an independent group cite
API's reputation in Washington as a petrified bureaucratic monolith
which, as one source put it "is still dealing with the War of
1812." API is best known for wheeling and dealing on international
issues and maintaining reliable databases of facts and figures
about the oil industry.
It is not surprising that the chairman of the pipeline
association which frequently locks horns with NGSA over issues at
the Federal Energy Regulatory Commission voiced support last week
for API's entry into the natural gas arena. The older and larger
oil-focused organization would not be expected to be as fleet and
feisty and thrust so many obstacles into the path of natural gas
pipelines now pushing for their own form of deregulation.
Meanwhile NGSA last week continued its barrage against
pipelines, asking FERC Chairman James Hoecker to put off action on
Columbia Gas' filing for negotiated terms and conditions while it
acts on the issue generically.
©Copyright 1998 Intelligence Press, Inc. All rights
reserved. The preceding news report may not be republished or
redistributed in whole or in part without prior written consent of
Intelligence Press, Inc.