Industry should take a “pipeline-by-pipeline approach” to tackling and resolving the contentious natural gas quality and interchangeability issues, two major gas groups said in a joint statement issued Friday.
“We agree that a pipeline-by-pipeline approach is necessary to address and resolve any natural gas quality concerns regarding hydrocarbon liquid dropout (specifically, whether to establish a cricondentherm hydrocarbon dew point) and interchangeability of natural gas supplies (specifically, whether to establish an interchangeability specification such as Wobbe in the pipeline tariff),” said the Interstate Natural Gas Association of America (INGAA) and the American Gas Association (AGA), which represent interstate gas pipelines and gas utilities respectively.
A pipeline and its shippers should notify each other if they want to discuss gas quality/interchangeability issues, including the possibility of tariff changes, the two groups said in the statement that was filed at FERC. “As soon as practical, the pipeline and its customers should exchange historical information regarding the quality of gas delivered by the pipeline and used by the customers and other relevant information, such as any problems experienced in connection with hydrocarbon liquid dropout and the interchangeability” of liquefied natural gas and traditional gas, they noted.
Once information has been shared, “interstate pipelines and their customers should meet to discuss specifications to address hydrocarbon liquid dropout and the interchangeability of natural gas supplies and, if necessary, the need for pipeline tariff revisions in order to ensure the continuation of this reliability. Group discussions with all customers will be beneficial, although individual meetings are also encouraged.”
If no customer contacts a pipe with gas quality/interchangeability concerns, the pipeline will not be required to initiate discussions on its own, INGAA and the AGA said. Also, pipelines that have already resolved these issues through settlement or administrative litigation will not be required to participate in this process either, they noted.
“If as a result of these discussions, tariff revisions to current gas quality specifications are deemed necessary, AGA and INGAA anticipate such tariff revisions being submitted in the form of a negotiated settlement and the FERC reviewing and approving such settlement.”
Barring a consensus between parties, “AGA and INGAA anticipate that such discussions will continue under the guidance of the FERC mediation staff or other alternative mediation services with the goal of filing a consensus document with FERC no later than one year from the date of this joint statement,” the two groups said.
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