Plains Petroleum Co., Lakewood, Colo., has agreed with the buyer of about 85% of its gas production to receive varying wellhead prices in 1991 under U.S. base contracts.
Prices will range from a high of $1.95/MMBTU in the high demand season in the winter and late fall to $1.65/MMBTU in the low demand season. Assuming normal weather, the base contract average price for 1991 will be $1.80/MMBTU, off slightly from this year's $1.84/MMBTU.
Prices are to be renegotiated every year.
After sales required by base contracts, Plains will supply as much as an additional 1.7 bcf of gas at a 11 special market incentive" wellhead price of $1.40/MMBTU during the low demand season.
This gas, covered under a separate 1 year "best efforts" contract, will be produced mainly from Plains' Kansas Hugoton reserves.
With the new best efforts contract included, Plains estimates that 1991 gas volumes sold will jump about 17.5% and revenues received from its main purchaser will increase by about 12.5% from its 1990 forecast of 18 bcf and $33 million.
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