A former pipeline lobbyist has been tapped to steer the NaturalGas Supply Association (NGSA) back on course following the scandalin which its former president, Nicholas J. Bush, allegedly swindled$2.8 million from the group.

R. Skip Horvath, who departed the Interstate Natural GasAssociation of America in February after 16 years with the group,was unanimously endorsed as NGSA’s new president by its board ofdirectors. He is expected to assume the position, which has beenvacant for almost four months, on Aug. 1. – after he liquidates hisVirginia-based consulting firm, OnEnergy.

Until then, Horvath said he doesn’t intend to turn a “blind eye”to the association, which represents major gas producers. “I willbe helping out” in the interim so “I will [be able to] hit theground running” in August, he told reporters during a pressbriefing at NGSA’s headquarters last Tuesday.

NGSA Chairman Richard J. Sharples said Horvath was selected froma pool of about 30 candidates because his “values” coincided withthose of the association’s. “The fact that we were able to getsomebody that is well rounded and well known in [Washington D.C.]was an…added benefit,” he noted. “He knows the issues…he knowsthe policymakers, he knows the folks on the Hill. I think he bringstremendous credibility to our association.”

Horvath conceded that at first he had “some skepticism” aboutwhether he would be able to make the transition from a pipelineassociation to a producer association, but that quickly vanished.Given his 20 years experience in the gas industry, “getting my mindaround different positions is not a stretch,” he said. Also, “youhave to remember that the association is an industry [unto]itself…If you can run one, you can run another. And that’s theset of skills I’m bringing over [to NGSA], not policy positions.”

He said he accepted the position because he was “tremendouslyimpressed” with the NGSA board’s “resolve to remain strong, toremain an organization that speaks…for major natural gasproducers” in spite of problems created by the alleged fraudulentbehavior of its former president. “I would not have taken this jobhad I thought there was even a reasonable chance that they might beabsorbed elsewhere, or go away…They are around for the long haul,and I’m around here with them,” he noted.

Horvath admitted his new job won’t be easy thanks to the legacyleft by Bush, who now faces criminal mail fraud and tax evasioncharges, and is the target of an NGSA civil lawsuit to recover thestolen funds. “There’s no doubt this is a challenge – to look atthe association, assess it in light of what happened and moveforward…There’s some baggage to it that I have to be conscious ofall the time. But the point is we are moving forward. There won’tbe much looking behind once I get on board.”

One of Horvath’s tasks will be restoring the effectiveness ofNGSA’s lobbying activities on Capitol Hill and at FERC, whichSharples conceded has been somewhat undermined in the wake ofBush’s alleged fraud.

Horvath spoke of plans for a “new NGSA” under his leadership.”Like any great shift, [this] will come gradually…I can tell youthat there is an openness at the NGSA…board to re-think the waythey do things in Washington, the way they do things in theindustry,” he told reporters. He couldn’t describe what the newNGSA would look like down the road, but he said it will have threethemes: 1) more collaboration – the producer group will reach outto other gas associations and industry sectors “in a way we haven’tdone before, to try to build a [few] more bridges and work togetheron the issues;” 2) a greater focus on public policy to enableregulators to do their job better; and 3) a shift in thedecision-making authority with respect to NGSA policy, placing itin the hands of business people rather than regulatory attorneys.Horvath, in effect, wants to call a truce to the “warfare” betweenindustry associations. “I hold that as a goal. Whether I achieve itor not remains to be seen.”

Sharples, too, was optimistic about the association. “This maycome as a surprise to you, but in my 15 years with NGSA I believethe association is the strongest today it’s ever been. There’sunqualified support [from] our members that NGSA is their voice onnatural gas market issues.” And although NGSA is in the midst of alawsuit to recover funds that were embezzled from the group, hesaid it’s in good shape financially. “Actually, we’re strongerfinancially than we’ve been in a number of years. We have greatsupport from our members in terms of the dues base. They’re allpaid up. We have a larger reserve base” than in past years.

All questions concerning the NGSA’s civil lawsuit against Bushwere off-limits to reporters. “This issue is a legal matter, and itneeds to run its legal course,” Sharples said. He noted, however,that NGSA has enacted tighter internal controls to prevent arecurrence of fraud, The changes are based on the “best practices”of producer companies and other associations, as well as on therecommendations of an independent consulting firm. Horvathindicated that one of his first tasks when he assumes leadership inAugust will be to further assess internal-control standards forassociations.

Susan Parker

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