Associations File Joint Comments Regarding Natural Gas Market Transparency

Associations File Joint Comments Regarding Natural Gas Market Transparency

WASHINGTON, DC — A group of eight trade associations representing a broad spectrum of the natural gas industry and consumers today urged the Federal Energy Regulatory Commission (FERC) not to expand natural gas reporting requirements.

The joint filing was made in response to FERC’s Notice of Inquiry issued November 15, 2012, seeking comments on a proposal to further facilitate price transparency in the natural gas markets by requiring all market participants engaged in sales of wholesale physical natural gas in interstate commerce to report quarterly every natural gas transaction within the Commission’s jurisdiction.

The groups involved in the joint filing include:  the American Forest & Paper Association, the American Gas Association, the Gas Processors Association, the Independent Petroleum Association of America, the Interstate Natural Gas Association of America, the Natural Gas Supply Association, the Process Gas Consumers Group and the Texas Pipeline Association.

The trade associations argued that FERC’s proposal to expand the reporting requirements would not improve – may actually harm – transparency.  The groups also argued that the proposal could undermine greater confidence in natural gas price formation and unfairly impose burdens on a limited portion of the natural gas market.

According to the trade associations, because FERC does not have jurisdiction over all wholesale natural gas sales, its proposal would capture only a portion of the market. The sales that would be reported may not be representative of the broader market and may provide a false sense of what is occurring in the marketplace.

The trade associations were also concerned that the public dissemination of detailed transaction information would put reporting parties at a competitive disadvantage to the detriment of natural gas consumers.  As stated in the joint filing, “the disclosure of commercially sensitive information simply cannot be applied to some market participants and not others without creating the potential for competitive harm.”

Through the filing the trade associations urged the Commission to reconsider its approach and not move forward with the proposal in the Notice.

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American Forest & Paper Association, Inc. is the national trade association of the forest products industry, representing pulp, paper, packaging and wood products manufacturers, and forest landowners in the United States.  AF&PA members make products essential for everyday life from renewable and recyclable resources that sustain the environment.  Members of AF&PA own and operate facilities that consume natural gas that is delivered through the interstate pipeline system.

The American Gas Association, founded in 1918, represents more than 200 local energy companies that deliver clean natural gas throughout the United States.  There are more than 71 million residential, commercial and industrial natural gas customers in the U.S., of which 92 percent — more than 65 million customers — receive their gas from AGA members.  AGA is an advocate for local natural gas utility companies and provides a broad range of programs and services for member natural gas pipelines, marketers, gatherers, international gas companies and industry associates.  For more information, please visit www.aga.org.

The Gas Processors Association is a non-profit trade organization made up of approximately 130 corporate members, all of whom are engaged in the processing of natural gas into merchantable pipeline gas, or in the manufacture, transportation, or further processing of liquid products from natural gas.  GPA’s membership accounts for approximately 92 percent of all natural gas liquids produced by the midstream energy sector in the United States.  GPA’s members also produce, gather, transmit, and market natural gas and natural gas liquids, and include a number of Canadian and international companies that produce natural gas liquids on a global scale.

The Independent Petroleum Association of America represents thousands of American independent oil and natural gas producers and associated service companies.  Independent producers develop 95 percent of American oil and gas wells, produce 54 percent of American oil, and produce 85 percent of American natural gas.  IPAA members produce gas that is transported through the interstate pipeline system.

The Interstate Natural Gas Association of America is comprised of 27 members, representing the vast majority of the interstate natural gas transmission pipeline companies in the United States and comparable companies in Canada.  INGAA’s members, which operate approximately 200,000 miles of pipelines, provide an indispensable link between natural gas producers and natural gas consumers in the residential, commercial, industrial and electric power sectors.  INGAA members are committed to providing reliable transportation services to their diverse customers, without undue discrimination, and to maintaining a high level of customer service.

Established in 1965, the Natural Gas Supply Association represents integrated and independent companies that produce and market approximately 40 percent of the natural gas consumed in the United States. The Natural Gas Supply Association encourages the use of natural gas within a balanced national energy policy and promotes the benefits of competitive markets to ensure reliable and efficient transportation and delivery of natural gas and to increase the supply of natural gas to U.S. customers.

The Process Gas Consumers Group is a trade association of industrial consumers of natural gas organized to promote the development and adoption of coordinated, rational, and consistent federal and state policies with respect to gas service to industrial gas users.  Members of PGC own and operate manufacturing facilities that consume natural gas that they receive through the interstate pipeline system.

The Texas Pipeline Association is an organization of 40 natural gas and liquids intrastate pipeline companies operating in the State of Texas.  Many of the TPA’s members operate in other states as well.  The TPA’s members gather, process, treat, transport, store and deliver natural gas and liquids for their customers, which include producers, marketers, commercial and industrial end-users, other pipelines, and distribution companies.  The TPA member companies engage in the transportation, storage and sale of natural gas, and their intrastate activities are subject to the jurisdiction of the Texas Railroad Commission and other state commissions.

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