Abstract: It's Time for a New Sheriff, or Why States Should Regulate Gas Gathering
GRAVES, CODY L.
It used to be so simple. Producers of natural gas sold their gas to the nearest interstate pipeline. Interstate pipelines bought, processed, transported and then sold enough natural gas to meet their large long-term supply contracts with local distribution companies (LDCs) and the occasional industrial customer. LDCs signed long-term supply contracts with several interstate pipelines and then resold the gas to captive residential, commercial and industrial customers. Finally, individual customers just picked up the phone, called the LDC and told it to turn on the gas.
Thanks to sweeping legislative and regulatory policies flowing from Washington, the natural gas industry has undergone dramatic change. Interstate pipelines no longer perform the merchant function of the past. Pipelines have restructured their businesses to offer their customers only the specific services they request. However, regulation of gathering has fallen through the cracks.
This paper will explore why it is important to employ the state regulatory agencies as the institutions available to protect against unfair conduct by gatherers. Further, this paper will summarize Oklahoma's gathering law, with its broad flexible framework. The law authorizes the Oklahoma Corporation Commission (OCC) to conduct a hearing and granted the OCC authority to order the remediation of any unjustly or unlawfully discriminatory fee for gathering to the extent necessary for the remediation of such fees as the aggrieved person for the particular service involved.
AAPG Search and Discovery Article #90944©1997 AAPG Mid-Continent Section Meeting, Oklahoma City, Oklahoma