Gas proration - what it did, what it does now, what it is supposed to do, and what it is perceived to do

Conference · Mon Jun 01 04:00:00 EDT 1992 · Interstate Oil Compact Commission Committee Bulletin; (United States)

OSTI ID:6314698

LeMay, W J ^[1]

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1. New Mexico Oil Conservation Division, Santa Fe (United States)

When pipelines defined gas markets, proration worked, along with ratable takes, to supply those gas markets with gas produced and used in proration to gas reserves underlying each producer's developed acreage. Gas allowables were established in certain designated fields, usually fields where there was more than one pipeline taking gas. Pipelines nominated gas supplies and proration authorities assigned allowables to satisfy that demand. Proration also had the effect of allocating available pipeline capacity (but don't tell FERC). What it does now is attempt to supply some natural gas to markets in proportion to gas reserves underlying each owner's developed acreage. It gives gas owners the opportunity to protect their correlative rights. It can also have the effect of allocating scarce pipeline capacity. What it is supposed to do is to prevent waste and protect correlative rights. What it is perceived to do in most consuming states is to restrict the available supply of gas so as to raise prices.

• OSTI ID: 6314698
• Report Number(s): CONF-9206355--
• Conference Information: Journal Name: Interstate Oil Compact Commission Committee Bulletin; (United States) Journal Volume: 6:1
• Country of Publication: United States
• Language: English

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