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FERC Postpones Deadline For Pipelines To Act On Open Access

February 13, 1986

WASHINGTON (AP) _ The Federal Energy Regulatory Commission on Wednesday postponed the deadline by which natural gas pipelines have to decide whether to open their lines to all who want to use them, including those offering cheap gas.

The commission voted 3-1 to move the deadline from Saturday to July 1.

The more companies that decide to open their lines, the more widely available cheap spot-market gas can be. Few have opened their lines so far.

The pipelines and trade associations that asked for a delay made ″a persuasive case″ that Saturday was too early; that ″we are going to be creating disruption in gas markets without any offsetting benefits,″ said Commissioner C. Michael Maeve, who voted with the majority.

The dissenter, Charles G. Stallon said, ″Anytime we impose a deadline there will be disruptions.″

A federal appeals court ruling last year said the commission could not permit pipelines to make special deals for carrying cheap spot-market gas to large industrial customers who could threaten to switch to oil while permitting those same pipelines to deny similar gas to customers without the ability to switch, such as distribution companies serving homes and businesses in a particular area.

The commission last fall ordered pipelines to choose what they would be - open access carriers, transporting gas for anyone who would pay transportation fees; or traditional pipelines as the sole suppliers of their customers with their own gas and able to exclude other gas from their lines.

Customers of a pipeline chosing open access where permitted to reduce, during the next five years, the amount of gas they must take from the pipeline under existing contracts.

Some pipelines have protested bitterly they were given no similar relief from high-cost ″take or pay″ contracts with owners of gas wells.

Only about a dozen of the 128 interstate pipelines have chosen ″open access.″ Some wells have been shut in as pipelines have refused to transport gas from them.

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