CANADA-CALIFORNIA GAS EXPORT DISPUTE BECOMES THORNIER

Canada's National Energy Board has reserved decision on whether it will subpoena California executives and regulatory officials in a natural gas export dispute. NEB is holding hearings in Calgary on the fight between California regulators and Alberta gas producers over contracts and pipeline access covering as much as 51 billion in gas sales. California Public Utilities Commission has ordered the Alberta-California pipeline system operated by a unit of Pacific Gas & Electric Co. be opened

March 9, 1992

2 min read

Canada's National Energy Board has reserved decision on whether it will subpoena California executives and regulatory officials in a natural gas export dispute.

NEB is holding hearings in Calgary on the fight between California regulators and Alberta gas producers over contracts and pipeline access covering as much as 51 billion in gas sales.

California Public Utilities Commission has ordered the Alberta-California pipeline system operated by a unit of Pacific Gas & Electric Co. be opened to all shippers in November.

Alberta producers selling to PG&E unit Alberta & Southern Gas Ltd., Calgary, say this would violate long term contracts allocating them 75% of pipeline capacity. A&S was granted an extended license in 1988 by the NEB to export 1.1 bcfd of gas to 2010, and the Canadian Petroleum Association asked NEB to review the company's license, triggering the hearings.

CHARGES, COUNTERCHARGES

CPA alleges CPUC pressured companies to force cuts in Alberta gas prices and asked NEB to subpoena CPUC and PG&E officials to testify at the hearings.

CPUC filed its position with the NEB in a letter of comment and did not have a legal spokesman at opening sessions of hearings. CPUC lawyer Tom Brett later told NEB that under U.S. law there is no way to enforce subpoenas requiring CPUC officials to testify before NEB.

PG&E attorneys said they will oppose any move to have executives testify before NEB, citing the possibility that could prejudice lawsuits totaling more than $400 million by producers against PG&E and A&S.

CPA lawyer Kemm Yates accused the California officials of trying to stonewall NEB, contending NEB is equivalent to a superior court and can request a U.S. federal court to compel California officials to testify.

A&S Pres. Don McMorland told NEB he could not promise to restore lost sales even if NEB agreed to limit pipeline access to all but the current supply pool. McMorland said California customers have access to other energy sources, including oil and U.S. Southwest or Rocky Mountain gas.

Alberta urged NEB to take action to support existing contracts.