H.Q. ENERGY SERVICES (U.S.) INC.
FE DOCKET NO. 98-31-NG
I. DESCRIPTION OF REQUEST
On April 14, 1998, H.Q. Energy Services (U.S.) Inc. (HQUS) 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 100 Bcf of natural gas each from Canada and Mexico and to export up to 100 Bcf of natural gas each to Canada and Mexico. The authorization would be for a two-year term beginning on the date of first import or export delivery. HQUS, a Delaware corporation with its principal place of business in Montpelier, Vermont, is a wholly owned indirect subsidiary of Hydro-Quèbec. HQUS plans to import and export the natural gas under short-term and spot market arrangements on its own behalf or on behalf of others. The proposed authorization does not involve the construction of new pipeline facilities.
The application filed by HQUS has been evaluated to determine if the proposed import and 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 or 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 HQUS 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.
Pursuant to section 3 of the Natural Gas Act, it is ordered that:
A. H.Q. Energy Services (U.S.) Inc. (HQUS) is authorized to import up to 100 Bcf of natural gas each from both Canada and Mexico and to export up to 100 Bcf of natural gas each to both Canada and Mexico. The term of the authority is for two years beginning on the date of first import or export delivery.
B. This natural gas may be imported and exported at any point on the borders between the United States and Canada and between the United States and Mexico.
C. Within two weeks after deliveries begin, HQUS shall provide written notification to the Office of Natural Gas & Petroleum Import and Export Activities of the date that the first import or export of natural gas authorized in Ordering Paragraph A occurred.
D. With respect to the natural gas imports and exports authorized by this Order, HQUS 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 of natural gas have been made. Quarterly reports must be filed whether or not initial deliveries have begun. If no imports or exports of natural gas have been made, a report of "no activity" for that calendar quarter must be filed. If imports or exports have occurred, HQUS must report the following: (1) total monthly volumes in Mcf; (2) the average monthly purchase price of gas per MMBtu at the international border; (3) the name of the seller(s); (4) the name of the purchaser(s); (5) the estimated or actual duration of the agreement(s); (6) the name of the U. S. transporter(s); (7) the point(s) of entry and exit; and (8) 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 (2) the per unit (MMBtu) demand/commodity/reservation charge breakdown of the contract price.
E. The notification and quarterly reports required by Ordering Paragraphs C and D of this Order shall be filed with the Office of Natural Gas & Petroleum Import and Export Activities, Fossil Energy, Room 3E-042, FE-34, Forrestal Building, 1000 Independence Avenue, S.W., Washington, D.C., 20585.
F. The first quarterly report required by Ordering Paragraph C of this Order is due not later than July 30, 1998, and should cover the period from the date of this Order through the end of the second calendar quarter, June 30, 1998.
Issued in Washington, D.C., on May 06, 1998.
John W. Glynn
Manager, Natural Gas Regulation
Office of Natural Gas & Petroleum Import and Export Activities
Office of Fossil Energy
1. 1/ 15 U.S.C. § 717b.