In a move to ease developing natural gas shortages in the East and Gulf Coast states, the Federal Power Commission yesteday unanimously approved extended emergency sales of high-priced gas by an unregulated Texas distributions to two interstate pipelines.
The ruling is expected to make it easier for other interstate pipelines, short of the fuel because of the very cold winter, to have access to unregulated gas for long periods of time.
Under federal price controls, gas flowing through interstate pipelines costs a maximum of $1.42 per thousand cubic feet. Unregulated gas sold within the state in which it is discovered costs as much as $2.50 per thousand cubic feet.
This disparity in price has kept most of the gas discovered on shore in recent years in the unregulated, intrastate marketrather than under federal jurisdiction.
What the Federal Power Commission ruled yesterday was that the Houston Pipeline Co. could continue its sales of emergency gas to Transcontinental Gas Pipe Line Co. in a manner whcih would assure that Houston did not come under federal regulation.
Houston has been selling Transco up to 150 million cubic feet a day and Interstate 85 million cubic feet a day under special 60-day emergency sales contracts druing November and December. These emergency sales - called "self-help" produces - are provide for in the FPC regulations and can be renewed if needed.
But Houston was reluctant to renew the agreement because it feared such continuous sales ot interstate pipelines would put the company under FPC regulations.
So, when the first 60-day emergency sales contracts expired, Transco and United switched their gas with Transco taking 85 million cubic feet and United 150 million.
Last week the FPC judged the sales to be exgensions of the earlier 60-day agreement and not a continuation of an earlier agreemnet.
The FPC yesterday ruled that the sales could be interpreted as "new" ones because the two interstate pipe line were getting their source of gas from different producers, even though the distributor and gatherer, the pipeline, was the same.
The FPC ruling raises the possibilty that intrastate pipelines and producers and interstate pipelines might be able to make an end-run around federal gas regulations by switching back-and-forth all winter or all year, for that matter.
But the commission cited the "number" pipelines either facing or expected to face shortly, deficiencies in gas supplies.It said these peipelines will have to use the emergency sales procedures with "increasing frequency" this winter as available gas supplies dwindle.r as availabe gas supplies dwindle.