Tulsa, OK-based Williams Cos. Inc. disclosed this week that it is the target of an inquiry by the Securities and Exchange Commission (SEC) into its round-trip trading activity in western energy markets.

In a second-quarter 10-Q statement filing, the energy company said it received a SEC request on May 31 to produce documents and information related to any “prearranged or contemporaneous” round-trip trades for natural gas or power that were carried out from Jan. 1, 2000 to the present.

On June 24, the federal agency made a follow-up request for information about Williams’ “credit, prudency and/or other reserves associated with its energy trading activities and the methods used to determine or calculate these reserves.” The reference is to funds the company set aside against the possibility its customers wouldn’t pay or against unexpected turns in the market. Most suppliers dealing with California set aside reserves during the energy crisis because the financially-strapped utilities in the West were unable to pay.

The SEC further directed Williams to provide information about its volumes, revenues and earnings from its energy trading activities in the western region of the United States, the company said. Williams noted it was “in the process of responding to the SEC’s requests.”

The company also is the target of parallel investigations by the Federal Energy Regulatory Commission and Commodity Futures Trading Commission into round-trip trading and price manipulation in West Coast energy markets. As part of its probe, FERC is exploring allegations by a former Williams’ employee that the company attempted to “corner” the natural gas market in California.

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