|Washington, D.C. – U.S. Senator Mike Enzi, R-Wyo., believes the Federal Energy Regulator Commission (FERC) now has a better awareness of problems associated with the wholesale natural gas price differential between Wyoming and other areas of the country.
Enzi's comments came after he met with FERC Chairman Pat Wood, III, Mark Robinson, FERC's Director of the Office of Energy Projects and Dennis O'Keefe, FERC Deputy Director of the Office of Market Oversight and Investigation, in Enzi's Washington, D.C. office Friday afternoon.
"I'm very encouraged," said Enzi. "Although Chairman Wood, because of legal reasons, was not allowed to promise an investigation into the gas price matter, he did indicate that any information we provide them regarding the increase in prices since I first raised the issue will be evaluated. He said his agency will also look closely at comments from natural gas producers who may have an idea why they have not been getting a fair market price."
Enzi said the FERC officials came to the meeting well-prepared with charts, graphs, maps and the factors at play in the price differential issue, but Enzi believes a big part of the reason the meeting was productive was because he was able to show the officials how their information related to the problem.
"I used their materials to make the points I've brought up in my letters," said Enzi. "We need to find out if pipeline management or other regulated activity is contributing to the price differential of natural gas in Wyoming. We also talked about why this is so important to Wyoming; how this relates to how much revenue is received from federal mineral royalties, a large percentage of which goes to pay for education in Wyoming. A large, negative price differential means lower revenues for Wyoming's schools."
Enzi also discussed how problems with the cattle market may parallel how the small gas producers may not be getting a fair shake in the marketplace. In the cattle trade the middlemen, the meatpackers, have a huge share of the market and can affect sale prices. Enzi said they force cattle producers to sell to them at very low prices. The prices for consumers stay high regardless of the producer price.
Enzi also said the timing and relevance of the meeting was emphasized by the news that a former energy company official was indicted Wednesday for false reporting of gas prices. Wyoming producers have means to be proactive
O'Keefe noted the agency has an enforcement hotline that is provided for market participants or the general public to call or e-mail with information about possible abuse of market power, affiliate relationship, tariff violations, bidding anomalies, price spikes or other possible problems that need to be looked at closer.
"This is a great way for Wyoming producers and others affected by these price differences to be proactive. I encourage producers, especially those with ideas on how to solve problems, to get in touch with FERC,"said Enzi.
The Federal Energy Regulatory Commission's Enforcement Hotline's toll free number is 1-877-FERC-MOI or 1-877-337-2664. The Hotline can be contacted by e-mail at firstname.lastname@example.org.
Enzi was also pleased FERC is trying to do a better job of coordinating with other federal agencies, such as the Mineral Management Service, who have jurisdiction over natural gas issues.