The Federal Energy Regulatory Commission last week gave NorAmGas Transmission the go-ahead to proceed with its plan to doublethe number of pooling areas on its system, effective April 1,subject to FERC review of a tariff filing outlining the poolboundary changes.

The Commission denied a request for a cease-and-desist ordersought by the Arkansas Gas Consumers and supported by severalproducers, which assailed NorAm’s pooling changes both onsubstantive and procedural grounds. Procedurally, they arguedNorAm’s pooling proposal amounted to a change in service and,therefore, required the pipeline to make a tariff filing underSection 4 of the Natural Gas Act (NGA).

The FERC agreed on this point. It “finds that, because of thepotential for significant impact to services, NorAm should file torevise its tariff to reflect these changes to its poolingservices,” the order said [RP98-158-001]. The Commission directedit to submit a tariff filing within seven days of the March 31storder, subjecting NorAm’s pooling proposal to potential revisions.But it denied the cease-and-desist action against the pipeline,conceding that NorAm may have “reasonably assumed” a Section 4filing wasn’t required in this case based on its 1994 ratesettlement and FERC precedent.

The Commission said it would rule on the merits of a complaintfiled by Arkansas Gas Consumers (AGC) in a later order. The groupcontends NorAm’s proposal will essentially “destroy” pooling on thepipeline’s system, restricting shippers’ access to gas supplies andto gas suppliers. It said the pooling changes are meant to benefitits marketing affiliate, NorAm Energy Services, “who is one of thefew pool managers controlling sufficient gas supplies (and withsufficient pipeline contacts), to manage the pooling quagmire thatNorAm is creating.” AGC further insists the pooling changes willhelp to foster NorAm’s “discriminatory” discounting practices.

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