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QUESTAR PIPELINE RECEIVES FINAL 636 ORDER FROM FERC

 SALT LAKE CITY, Aug. 3 /PRNewswire/ -- Questar Pipeline Co. (NYSE: STR) has received what it is calling a "successful conclusion" to its plans to comply with the Federal Energy Regulatory Commission's (FERC) Order No. 636.
 The FERC's Aug. 2 final order approves two key issues included in a March 2 order that the company had asked the commission to rehear: the allocation of gas-storage rights and the assignment of gas-purchase contracts to Mountain Fuel Supply Co., an affiliate of Questar Corp.
 Lowell Gill, Questar Pipeline vice president of regulatory affairs, said the company is generally pleased with the commission's order. "We have received favorable decisions on a number of major issues we set out to rectify," said Gill.
 Order No. 636 is the culmination of many years of FERC-directed changes to the natural gas industry. The changes generally have fostered the deregulation of interstate natural gas services and have moved the industry into a more competitive environment. FERC, a federal government agency, regulates rates, services, construction and facilities for interstate natural gas transmission companies.
 The commission issued Order 636 in April 1992, encouraging pipeline companies to unbundle sales and become primarily natural gas transporters, moving all responsibility for gas acquisition onto local distribution companies (such as Mountain Fuel) and other buyers.
 The commission's Aug. 2 decision allows Mountain Fuel to assume all available working-gas storage capacity in the pipeline's three peaking reservoirs and 7 billion cubic feet of working-gas capacity in the Clay Basin storage facility. (Working gas is the gas that pipeline customers inject into and withdraw from storage reservoirs.) The Clay Basin capacity reserved for Mountain Fuel is subject to Questar Pipeline's issuance of a report to the commission after one year of restructured operation.
 Also, the FERC affirmed that Mountain Fuel should receive all of Questar Pipeline's gas-purchase contracts. This ruling is important because it allows Mountain Fuel to obtain full control of the gas supplies traditionally used by Questar Pipeline to meet the distribution company's needs.
 According to Gill, the pipeline will be able to make the transition to operations under Order 636 by Sept. 1, 1993. "We still have some minor tariff issues to work out, and we will participate in a technical conference with the FERC staff and our customers sometime within the next 30 days or so to reach solutions that can accommodate Questar Pipeline's and our customers' needs," he added.
 The pipeline also was successful in convincing the FERC to approve its daily balancing tolerances (standards) on its system. This means customers are expected to keep their actual deliveries to within 5 percent of their daily transportation nominations, instead of the 10 percent tolerance originally suggested by the FERC. "This decision is important to us," said Gill. "It allows us to proceed with the restructuring without completely reordering supplies in our system or finding more storage for balancing needs."
 The commission also ruled that Questar Pipeline will be able, upon filing a new general rate case, to recover all of its prudently incurred transition costs associated with its Order 636 restructuring. Questar had asked the FERC to approve recovery of an estimated $9 million in transition costs at this time, but the commission ruled that the company's request was premature.
 Questar Pipeline engages in natural gas gathering and interstate transportation through a 2,490-mile system in Colorado, Wyoming and Utah. The company has underground storage facilities in Utah and Wyoming.
 Questar Pipeline is a wholly owned subsidiary of Questar Corp., an integrated natural gas company based in Salt Lake City.
 -0- 8/3/93
 /CONTACT: Adrian Gostick of Questar Pipeline, 801-534-5056 or (home) 801-654-2578/
 (STR)


CO: Questar Pipeline Co.; Questar Corp. ST: Utah IN: OIL SU:

LS-BP -- LA028 -- 9046 08/03/93 16:24 EDT
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Publication:PR Newswire
Date:Aug 3, 1993
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