Regulatory

The Federal Energy Regulatory Commission got it right, findingan access fee charged to interstate shippers by Southern CaliforniaGas was illegal-but then dropped the ball in failing to order$800,000 in refunds, the D.C. Court of Appeals said in a decisionhanded down May 22 (No. 97-1028).

The Federal Energy Regulatory Commission has succeeded incontriving an order (No. 587-G) that the natural gas industryalmost universally opposes, which is not that rare. What is rare,however, is the unanimity among pipelines, distributors, producersand end users on what is wrong with the Commission’s mandate thatall pipeline transactions be conducted over the Internet byelectronic data interchange (EDI) by June 1, 1999.

The Federal Energy Regulatory Commission’s authority formandatory pipeline bypass of a distribution company is up for grabsagain as a result of an Eleventh Circuit court decision lastThursday in the long-running Arcadian case (Atlanta Gas Light et alv. FERC 92-9121).

A final rule voted out Wednesday by the Federal EnergyRegulatory Commission sets June 1, 1999 as the date when allpipelines must provide all information and conduct all businessusing the public Internet and standardized protocols.

With regulatory changes and greater competition increasingpressure on gas utilities to stay competitive with their gaspurchases, the last thing they need is another warm winter toconfuse their gas purchasing and storage plans. NGC Corp. isoffering several new financial products utilities and largeendusers may find useful in reducing exposure to unpredictableweather and volatile market conditions.

The Federal Energy Regulatory Commission last week gave NorAmGas Transmission the go-ahead to proceed with its plan to doublethe number of pooling areas on its system, effective April 1,subject to FERC review of a tariff filing outlining the poolboundary changes.

Energy guru and Pulitzer-prize winning author Daniel Yergin toldFederal Energy Regulatory Commission staffers there will still be aplace for the agency in the next millennium despite the fact themarketplace is taking “The Commanding Heights” away fromgovernments.

With all regulatory approvals in place at both Federal andProvincial levels, sponsors of the Sable Island Offshore EnergyProject last week signed both their key commercial agreements andthe Facilities Alliance Agreement to engineer, construct andinstall production and gathering facilities to handle delivery of 3.5 Tcf of gas from offshore Nova Scotia. This formally commits theowners to the $2 billion first phase, which will deliver the firstgas in late 1999.