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Arkla Unbundling Talks Underway in Oklahoma

Arkla Unbundling Talks Underway in Oklahoma

While Oklahoma Natural Gas' (ONG) appeal of the Oklahoma Corporation Commission's interim order unbundling its upstream system winds its way through court, the OCC has turned to Arkla and the unbundling of its downstream system. Arkla will have its fourth open meeting with the commission and other interested parties Nov. 17. OCC Commissioner Bob Anthony is enthusiastic about how things have gone so far. "They [Arkla] have not just claimed confidentiality on everything. It's been very open and detailed. I don't normally go around bragging about utilities. I've asked some staff people if everything's operating in good faith and they've given me some encouragement."

So far, Arkla is on track to meet its April 1, 1999 deadline for filing an unbundling plan. It is hoped transportation-only residential and commercial customers will be signing up with marketers by the end of summer 1999. Arkla's system is predominantly residentials and commercials.

So far, Arkla is on track to meet its April 1, 1999 deadline for filing a downstream unbundling plan. It is hoped Arkla's 115,000 Oklahoma customers, mostly residentials and commercials, will be signing up with marketers by the end of summer 1999. Arkla has no storage, peak shaving or compression, so marketers can enter the Arkla system with less utility baggage.

The company's upstream already is unbundled. In 1985, Arkla split its transmission and distribution operations. Its pipeline operations have been FERC jurisdictional for the last six years. Arkla has been buying capacity on its own accord and making its own supply arrangements since the implementation of FERC Order 636.

The details of Arkla's unbundling were first touched on at its third commission meeting Oct 20. Topics hit uponto date include terms and conditions for marketers, allocation of receipt point capacity and capacity assignment. Ken Zimmerman, OCC public utility division planning coordinator, said the third meeting had the largest attendance to date.

Showing up were big marketers, such as Enron and PG&ampE, as well as smaller companies, such as Transok, Enogex and even smaller companies such as e prime and Stalwart Energy. "These meetings have been actually pretty non-eventful," Zimmerman said.

"The next meeting is going to focus on both consumer education, which experience in Ohio and Georgia suggests is very important, and the tax implications involved," said Paul Ruxin, a lawyer with Jones, Day, Raevis &amp Pogue, representing Arkla.

As for upstream unbundling on ONG, the commission is preparing documents for the Oklahoma Supreme Court, which recently agreed to hear ONG's appeal of the OCC's interim unbundling order. ONG maintains its challenge to the order is not a challenge to unbundling. To make its point, the company has competitively bid about 28 Bcf of gas supply for the winter heating season. That represents about a third of its system's winter requirement, according to spokesman Don Sherry. Joe Fisher, Houston

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