Marathon price below Enstar gas average - December 14, 2008

Providing coverage of Alaska and northern Canada's oil and gas industryDecember 2008

Vol. 13, No. 50

Week of December 14, 2008

Marathon price below Enstar gas average

Enstar Natural Gas Co. has notified the Regulatory Commission of Alaska that Marathon Oil Co. has agreed to a gas price below Enstar’s weighted average cost of gas for a new gas supply contract that starts Jan. 1. Marathon offered this type of price formula rather than accepting an RCA-determined gas price cap for Enstar’s new gas supply contracts.

Enstar had already notified RCA that ConocoPhillips agreed to a similar below-average-cost price formula for its new Enstar contract.

Although in principle Enstar can implement this type of price formula without RCA approval, Enstar has asked the commission to formally approve the price agreements — this is the first time Enstar gas supplies have been priced in this way and Enstar wants assurance of RCA agreement with the precise pricing terms.

—Alan Bailey

Petroleum News - Phone: 1-907 522-9469 - Fax: 1-907 522-9583
[email protected] --- http://www.petroleumnews.com ---
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