ALBERTA FINDS U.S. ALLIES IN CALIFORNIA DISPUTE

Alberta has joined an alliance of U.S. gas producing states that oppose pricing policies of the California Public Utilities Commission. Alberta is involved in a dispute with CPUC entailing pricing, pipeline access, and long term contracts between Alberta producers and California buyers. That impasse, which may lead to a grievance filing under the Canada-U.S. Free Trade Agreement (OGJ, Dec. 9, p. 74), continues over gas export trade of as much as 1 bcfd.

Dec. 16, 1991

3 min read

Alberta has joined an alliance of U.S. gas producing states that oppose pricing policies of the California Public Utilities Commission.

Alberta is involved in a dispute with CPUC entailing pricing, pipeline access, and long term contracts between Alberta producers and California buyers. That impasse, which may lead to a grievance filing under the Canada-U.S. Free Trade Agreement (OGJ, Dec. 9, p. 74), continues over gas export trade of as much as 1 bcfd.

ALBERTA JOINS ALLIANCE

Alberta is the first non-U.S. member of the Texas-based Energy Council, which includes state legislators in Alabama, Alaska, Arkansas, Colorado, Louisiana, New Mexico, Oklahoma, Texas and Wyoming. The council recently met in Lake Louise, Alta.

Ted Strickland, chairman of the council and president of the Colorado senate, said membership will help Alberta because CPUC no longer will be able to play it off against U.S. producer states.

Strickland said the council's mission is to influence policy decisions to ensure long term U.S. energy supply security, adding, "Alberta gas is an integral element of that equation, and we want to find solutions to our common problems."

If California can abrogate contracts with Alberta, "What is there to stop other public utilities commissions from following suit?" he asked.

Strickland said the council plans to pass a resolution at a meeting in Washington in March condemning the CPUC policy and asking it to allow California gas buyers to live up to existing contracts.

He also called for formation of a North American regulatory agency to oversee the gas industry in Canada and the U.S., contending it is becoming increasingly difficult for the gas industry to operate efficiently and effectively because it has to deal with a number of overlapping regulatory jurisdictions on both sides of the border.

IMPASSE UPDATE

Alberta Energy Minister Rick Orman said he will introduce changes effective mid-January at the latest requiring California buyers to take all gas under long term contract from a pool of 190 Alberta producers before they can buy additional Alberta gas on the spot market.

CPUC ruled recently that long term contracts with Alberta producers would have to be renegotiated by next October. Alberta says this violates an agreement that current contracts remain in force until 1994. Under that agreement, 25% of capacity in the Alberta-California Pacific Gas Transmission pipeline system is open to spot sales and the rest allocated to gas under long term contract.