UNITED STATES OF AMERICA

DEPARTMENT OF ENERGY

OFFICE OF FOSSIL ENERGY






CNG ENERGY SERVICES CORPORATION

FE DOCKET NO. 97-71-NG










ORDER GRANTING BLANKET AUTHORIZATION TO IMPORT

AND EXPORT NATURAL GAS FROM AND TO CANADA AND MEXICO












DOE/FE ORDER NO. 1304






OCTOBER 03, 1997




I. DESCRIPTION OF REQUEST

On September 26, 1997, CNG Energy Services Corporation CNG (CNG) filed an application with the Office of Fossil Energy of the Department of Energy (DOE), under section 3 of the Natural Gas Act (NGA)(1) and DOE Delegation Order Nos. 0204-111 and 0204-127, for blanket authorization to import up to 200 Bcf of natural gas from Canada and up to 200 Bcf of gas from Mexico, and to export up to 200 Bcf of gas to Canada and up to 200 Bcf of gas to Mexico. The term of this authorization would be for a period of two years beginning on the date of the initial delivery of either imports or exports, whichever occurs first, after October 31, 1997(2) CNG, a Delaware corporation with its principal place of business in Pittsburgh, Pennsylvania, is a wholly-owned subsidiary of Consolidated Natural Gas Company. CNG intends to import and export the gas under spot and short-term transactions, either on its own behalf or as the agent for others. The requested authorization does not involve the construction of new pipeline facilities.

II. FINDING

The application filed by CNG has been evaluated to determine if the proposed import/export arrangement meets the public interest requirement of section 3 of the NGA, as amended by section 201 of the Energy Policy Act of 1992 (Pub. L. 102-486). Under section 3(c), the import of natural gas and the export of natural gas from or to a nation with which there is in effect a free trade agreement requiring national treatment for trade in natural gas is deemed to be consistent with the public interest and must be granted without modification or delay. The authorization sought by CNG to import and export natural gas from and to Canada and Mexico, nations with which free trade agreements are in effect, meets the section 3(c) criterion and, therefore, is consistent with the public interest. This blanket order authorizes transactions under contracts with terms of no longer than two years.

ORDER

Pursuant to section 3 of the Natural Gas Act, it is ordered that:

A. CNG Energy Services Corporation (CNG) is authorized to import up to 200 Bcf of natural gas from Canada, and to import up to 200 Bcf of natural gas from Mexico. CNG is also authorized to export up to 200 Bcf of natural gas to Canada, and to export up to 200 Bcf of natural gas to Mexico. The term of this authorization is for a period of two years beginning on the date of the initial delivery of either imports or exports, whichever occurs first, after October 31, 1997. The natural gas may be imported and exported at any border point between the United States and Canada and Mexico.

B. Within two weeks after deliveries begin, CNG shall provide written notification to the Office of Natural Gas & Petroleum Import and Export Activities, Fossil Energy, Room 3F-056, FE-34, Forrestal Building, 1000 Independence Avenue, S.W., Washington, D.C. 20585, of the date that the first import or export of natural gas authorized in Ordering Paragraph A above occurred.

C. With respect to the natural gas imports and the natural gas exports authorized by this Order, CNG shall file with the Office of Natural Gas & Petroleum Import and Export Activities, within 30 days following each calendar quarter, quarterly reports indicating whether imports or exports have been made. Quarterly reports must be filed whether or not initial deliveries have begun. If no imports or exports have been made, a report of "no activity" for that calendar quarter must be filed. If imports or exports occur, NES must report total monthly volumes in Mcf and the average purchase price of gas per MMBtu at the international border. The reports also shall provide the details of each import and export transaction, including: (1) the name of the seller(s); (2) the name of the purchaser(s); (3) the estimated or actual duration of the agreement(s); (4) the name of the U.S. transporter(s); (5) the point(s) of entry and exit; and (6) the geographic market(s) served (for imports, by State). For import transactions only, the report shall also include: (1) whether sales are being made on an interruptible or firm basis; and, if applicable, (2) the per unit (MMBtu) demand/commodity/reservation charge breakdown of the contract price.

D. The first quarterly report required by Ordering Paragraph C of this Order is due not later than January 30, 1998, and should cover the period from November 1, 1997, until the end of the fourth calendar quarter, December 31, 1997.

Issued in Washington, D.C., on October 03, 1997.


_________________________________
Wayne E. Peters
Manager, Natural Gas Regulation
Office of Natural Gas & Petroleum
Import and Export Activities
Office of Fossil Energy

1. 1. 15 U.S.C. § 717b.

2. 2. This is the date CNG's current blanket authorization to import and export natural gas from and to Canada and Mexico expires. See DOE/FE Opinion and Order No. 647 issued July 28, 1992 (1 FE ¶ 70,612), as amended by DOE/FE Order No. 647-A issued August 5, 1993 (1 FE ¶ 70,829) and DOE/FE Order No. 647-B issued July 13, 1995 (1 FE ¶ 71,144). Orders 647 and 647-A were issued to CNG's predecessors, CNG Trading Company and CNG Gas Services Company, respectively.