Texas Administrative Code › Title 16 - ECONOMIC REGULATION › Part 1 - RAILROAD COMMISSION OF TEXAS › Chapter 3 - OIL AND GAS DIVISION › Section 3.34 - Gas To Be Produced and Purchased Ratably

Current through Reg. 49, No. 28; July 12, 2024
(a) Definitions. The following words and
				terms, when used in this section and in §
									RSA
				3.31 of this title (relating to Gas
				Reservoirs and Gas Well Allowable) (Statewide Rule 31) shall have the following
				meanings, unless the context clearly indicates otherwise.
(1) Affiliate--A person or entity that owns,
				is owned by, or is under common ownership with another person or entity to the
				extent of 50% or more or that otherwise controls or is controlled by another
				person or entity. Affiliates of a common entity are also affiliates of each
				other. A person or entity that purchases gas solely for purposes other than
				resale shall not be considered an affiliate, and an interstate pipeline, as
				defined in the Natural Gas Policy Act of 1978, §2(15) (15 United States
				Code §3301 et seq.), shall not be
				considered an affiliate of an intrastate pipeline.
(2) Commission designee--A Railroad
				Commission employee authorized to act for the commission. Any authority given
				to a commission designee is also retained by the commission. Any action taken
				by the commission designee is subject to review by the commission.
(3) Downstream purchaser--One that purchases
				natural gas for resale and is not a first purchaser.
(4) First purchaser or initial purchaser--The
				first purchaser of natural gas produced from a well. A first purchaser and any
				affiliate of the purchaser that transports any natural gas it purchases from a
				well by use of the same pipeline system used by the first purchaser of which it
				is an affiliate shall be treated as a single first purchaser for purposes of
				ratability requirements; provided, however, that an affiliate that is
				purchasing and accepting deliveries pursuant to a special marketing program
				that is in compliance with this section, shall be treated as a separate first
				purchaser; and, provided further that the designation of such affiliate as a
				separate first purchaser is reviewable by the commission and may be disallowed
				upon a showing that the designation was for purposes of circumventing this
				section. Any affiliate may file forms in its own name.
(5) Pipeline system--A network of physically
				connected pipelines that are operated as a single unit under normal conditions.
(A) A first purchaser's pipeline system is
				that portion of a physical segment of a pipeline that the first purchaser
				owns.
(B) If a first purchaser does
				not own the pipeline it uses to transport its gas, the first purchaser's
				pipeline system shall include all the wells from which it purchases that are on
				the pipeline system of the transport pipeline.
(C) A first purchaser may not segregate its
				purchases from any one field into two or more pipeline systems by transporting
				on another pipeline gas that it purchases as a first purchaser if the first
				purchaser is also purchasing as a first purchaser from the same field and
				transporting on a pipeline that it owns.
(D) A first purchaser may not segregate its
				purchases from any one field into two or more pipeline systems by executing gas
				exchange agreements.
(E) Any of a
				first purchaser's pipeline systems which serve a common customer or common
				customers in a common geographic location shall be operated in a manner to
				avoid unjust or unreasonable discrimination in takes as between those
				systems.
(F) A first purchaser
				shall not segregate its physically connected pipelines that are capable of
				being operated as a single unit under normal conditions into two or more
				pipeline systems or designate a gathering system as a separate system for
				purposes of circumventing this section.
(6) Prorated gas field--A reservoir or field
				in which an allocation formula is in effect.