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Industrials, Producers Seek Order 637 Court Review

Industrials, Producers Seek Order 637 Court Review

Producers and industrial gas customers have filed petitions for review of FERC's latest revisions to the natural gas market, Orders 637 and 637-A, in the U.S. Court of Appeals for the District of Columbia (Case No. 00-1217) (see NGI, Feb. 14 and May 22)

Industrials joining in the review petition include the Process Gas Consumers Group (PGC), American Iron and Steel Institute, Georgia Industrial Group, Alcoa Inc., and United States Gypsum Co. Their main problem with the Federal Energy Regulatory Commission rule is that it limits the application of the right-of-first-refusal (ROFR) requirements for pipelines to apply when customers' long-term capacity contracts expire. Although Order 637 retains the ROFR and its five-year matching cap, the Commission has narrowed the number of shippers and transactions to which it applies and raised the maximum rate in some cases (see NGI, March 13).

Producers, including ExxonMobil, Amoco Energy Trading, Amoco Production, Anadarko Petroleum, Burlington Resources Oil and Gas, Conoco, Marathon Oil, Shell Offshore, Texaco Natural Gas and Texaco E&P, are opposed to the centerpiece of the rule, the lifting of the rate caps on the short-term secondary market.

Ellen Beswick

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