FERC on Tuesday initiated audits of several energy companies to determine whether they are complying with the agency regulations governing the reporting of prices on natural gas trades to published indexes.
Letters announcing the audits were sent to BG Energy Merchants LLC, Marathon Oil Co. and Anadarko Energy Services, according to files posted on the Federal Energy Regulatory Commission’s website [PA06-12, PA06-13, PA06-11]. It could not be immediately learned if more audits are scheduled.
Auditors will review company records from Jan. 1, 2005 through the present to learn whether the energy companies are satisfying the requirements of the agency’s price index reporting rules, which set reporting standards and prohibit traders from manipulating gas prices.
The Natural Gas Act (NGA) “allows the audit team to access copies of any accounts, records or memoranda that pertain to the audit; requires companies to furnish, within reasonable time frames, any information which the Commission may require; and requires companies to grant agents of the Commission free access to its property, accounts, records and memoranda,” wrote Bryan K. Craig, director of FERC’s Division of Audits, Office of Enforcement, in letters to the three companies.
The scope of the records considered relevant to the audit is wide, and encompasses “all documents and communications which are in the possession, custody or control of the company,” according to Craig.
The NGA bars any employee of the Commission from divulging information obtained during the audit, except as directed by the agency of by a court, he said. Craig also said documents and information obtained by FERC staff during the audit, as well as all working papers developed, will be place in nonpublic files.
FERC’s guidelines for price reporting, initially set out in a policy statement in July 2003 (PL03-3), require companies to tell FERC whether they are reporting prices to publishers, or not. If they are reporting, they must do so in a prescribed manner from an administrative office of the company with executive oversight and include all relevant transactions as defined by FERC and the publishers.
According to the policy statement, as amended, companies providing data also must retain records of their trades and reports for five years. In addition, reporting companies are required to have an independent auditor review their data gathering and submission processes annually, making the results of the audit available to the publishers to whom they submit data.
©Copyright 2006Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.
© 2020 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |