CANADA'S NEB CLAMPS DOWN ON SHORT TERM GAS SALES TO CALIFORNIA

Canada's National Energy Board has taken interim action to limit new short term sales of natural gas to California. NEB said companies planning to export gas under existing short term orders via the Kingsgate, B.C., border point must now receive prior permission. Shippers seeking new short term approvals must also seek board approval. Companies seeking approvals will be required to reveal the pipeline system to be used, destination of the gas, and end user.

Feb. 17, 1992

2 min read

Canada's National Energy Board has taken interim action to limit new short term sales of natural gas to California.

NEB said companies planning to export gas under existing short term orders via the Kingsgate, B.C., border point must now receive prior permission. Shippers seeking new short term approvals must also seek board approval.

Companies seeking approvals will be required to reveal the pipeline system to be used, destination of the gas, and end user.

The board will not permit Alberta & Southern Gas Ltd. to allot pipeline capacity to other shippers moving gas under short term contracts.

NEB said the action is necessary to prevent potential erosion of long term contract sales to California.

Companies seeking short term export approvals will be required to provide details of all pipelines involved in shipments and the prospective gas customers.

A hearing is scheduled to begin Feb. 24 when the board will review existing export licenses. The interim measures will remain in effect until the hearing is complete.

The NEB ruling stems from a contract dispute between Alberta producers and California regulators.

Producers say a ruling by the California Public Utilities Commission requiring open access to pipelines by November violates long term contracts under which a producer pool is allocated 75% of pipeline capacity.

Negotiators for the producers, CPUC, and Canadian officials are continuing talks to try to resolve the dispute.

They reached an agreement last month on the objectives and ground rules for negotiations.