R. Skip Horvath, president of the Natural Gas Supply Association(NGSA) and former official of a major pipeline group, took theinitial step last week towards trying to unify a fragmented naturalgas industry.

As head of the producer group, “I think the biggest challenge Ihave is getting this industry to collaborate,” he said in hismaiden speech to the Natural Gas Roundtable last Tuesday inWashington D.C. Although the gas industry has made some strides inthis area, “by and large, my gut says we’re still not” there yet.And he conceded he didn’t know just how the industry would reachthis goal.

As an industry, “we do not do a good job at the things we cancollaborate on,” such as reliability of service and the needs ofcustomers, Horvath noted. “…[W]e haven’t even sat down to reallydecide to try…..to figure what it is we can collaborateon…..Something’s got to change, folks.”

Horvath said a major step towards collaboration will occur nextJuly when the Natural Gas Council will sponsor a Natural Gas Summitin Colorado Springs, CO, which will bring major gas users togetherwith top industry executives. “The idea is to get a lot ofhigh-level executives…..from the customer group, those whoactually use gas, and get [them] together with our topexecutives…..to discuss what the customers’ need.”

He also thinks its time for producers and pipelines to end theirhostilities. “I think the center of the animosity between pipelinesand producers is based on the notion of risk and reward. Each has acompletely different perception about [their risk] and the otherguy’s risk and their potential for reward,” Horvath told producer,pipeline and LDC officials.

“I think it’s based frankly on some misunderstanding on bothsides, and the misunderstanding is sort of based on lack ofinformation…..And that is something that I hope to repair,” hesaid. While it’s expected that producers, pipelines and LDCs willtake opposite positions on Capitol Hill and at FERC due to theirdifferent economic interests, he noted it shouldn’t be takenpersonally.

He said he’s often asked by former pipeline colleagues what it’slike to work for a producer group now. “The producer community iscomprised of a group of people who are full of talent andintegrity…..These are high-quality professional people.” Butsince producers’ Washington offices focus more on Capitol Hill thanFERC, the pipelines and other gas groups don’t get to know them toowell, Horvath noted.

He said producers ask him similar questions about pipelines. Gasproducers “view pipelines as having the best of all worlds. They’vegot FERC protecting them at the bottom and they have an upside…”But he tells producers that pipeline officials are equally astalented and professional. “I get the same feeling from bothgroups.”

Going from a pipeline group to a producer association is “likejumping from a plane skydiving straight into the ocean, and thenscuba diving. It’s different,” but on the other hand, “it’s stillthe same industry,” Horvath said.

Ironically, he said producers and pipelines view themselves as”one industry” out in the field. “It’s just us [in Washington] thatthinks we’re separate industries. And it’s something we have to getover at some point.”

In keeping with the collaborative theme, Horvath unveiled a newlogo for NGSA that has a blue flame accentuating the last letter.He noted the Interstate Natural Gas Association of America’s(INGAA) logo has a similar blue flame between the last two letters,and the American Gas Association (AGA) has a flame between thefirst two letters. The N-G-S-A letters are light blue and tingedwith green to reflect the “environmental side” of the producergroup.

Horvath, who started the Distributed Power Coalition of Americaand still sits on the board, said his involvement with the groupwill lessen over time. “That’s my baby…..Like any proud parent, Iwish I could help them more…..But I really can’t,” he said,adding it was time for the group to stand on its own. “But I always[will] be there for them.” He believes distributed generation is”going to take off” because it will ensure greater reliability ofservice.

Lastly, Horvath indicated that much of the disruption caused bythe criminal and civil proceedings against former NGSA PresidentNicholas Bush are behind the association now. “We never talk abouthim,” he told NGI. While the criminal case against Bush ended lastmonth, the civil proceeding is expected to be resolved within lessthan a month, according to NGSA.

Susan Parker

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