Oklahoma Natural Gas (ONG) is digesting the Oklahoma CorporationCommission’s (OCC) recently released upstream unbundling order andfinding at least a few things it does not like. “Generally, basedon what we’ve seen in the order thus far, there is concern on thepart of management that the order as it exists now could curtailthe ability of our affiliate ONEOK Gas Transportation Co. (OGT) tocompete effectively in the marketplace,” said spokesman Don Sherry.”Our management’s considering where we go from here. Presumably theorder was described as an interim order. Presumably, there may beadditional options available to us at the Oklahoma CorporationCommission. Presumably there are legal options as well, but none ofthat has been decided at this moment.”

The OCC order would create OGT to own and operate non-regulatedservices currently part of the integrated ONG. Sherry said ONGmanagement might be able to comment on the order today.

According to Larry Lago, an aide to OCC Commissioner BobAnthony, the OCC order uses the cost of service figures from a 1994rate case to value the services to be unbundled. Transmission isworth more than $64 million, including about $5 million (subject tochange) for short-haul transmission to be credited back to theregulated utility. Storage is worth $12.9 million; gathering,nearly $9.4 million; gas supply, almost $12 million. Transmissionservice to be provided by the regulated utility post unbundling isvalued at nearly $172 million.

Lago said the commission needed to get the order out last Fridayto stick with its planned unbundling schedule. Bids are due Aug.15. Winning bidders are to be announced Sept. 1. Unbundledservices, except for storage, are to be provided to Oklahoma Cityand Tulsa beginning Nov. 1. If competitive bids from suppliersother than OGT are accepted, savings stemming from Tulsa andOklahoma City will be spread over the entire ONG system.

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