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Alternatives and New Directions in Marketing Natural Gas

Philip M. Marston, Natural Gas Marketing II (1988)

To understand how we got to where we are, it's helpful to remember how the world looked to the public policy experts back in 1978 when Congress voted to gradually remove federal [14-2] price controls over natural gas at the wellhead. Back in those days, the focus of the public debate was really on two issues: the impact decontrol would have on development of new reserves; and what decontrol would do to prices of gas in the producing fields and at the residential burnertip. In a word it was the producers against the consumers. Thus, the debate was hot and heavy over how high decontrol would drive average wellhead prices and whether the production industry was sufficiently competitive to prevent producers from gouging the ever present “captive consumer” (usually portrayed as “poor Aunt Mary in Schenectady”). And analysts and lobbyists debated whether deregulation would somehow stave off that inevitable day when the ever shrinking reserve base would have to be replaced by nuclear generated electricity, synthetic gas manufactured from coal and naphtha, and supplies of liquefied natural gas (LNG) from such undependable nations as Algeria and Indonesia.3

On November 9, 1978, the debate was closed by President Carter signing the NGPA into law.

That's when the fun — or the mischief, depending on your perspective — really began. For the seeds of both our present diffi