HomeMy WebLinkAboutOrdinance - 6855-1974 - Providing Monthly Adjustment To Nearest .01 Natural Gas Service - 02/28/1974ORDINANCE NO. 6855 ------
AN ORDINANCE OF THE CITY OF LUBBOCK, TEXAS .. PROVIDING FOR
MONTHLY ADJUSTMENTS .. TO THE NEAREST. Olt .. IN THE RATES CHARGED
FOR THE SALE OF NATURAL GAS SERVICE BY PIONEER NATURAL GAS COM
PANY WITHIN THE CITY OF LUBBOCK .. IN ACCORDANCE WITH INCREASES
OR DECREASES IN THE AVERAGE MONTHLY COST TO PIONEER OF GAS PUR
CHASED FOR ITS WEST TEXAS TRANSMISSION SYSTEM.; DEFINING COST OF
GASj PLACING CERTAIN LIMITS ON THE MAXIMUM ADJUSTMENT TO BE
ALLOWED HEREUNDERj PROVIDING A SAVINGS CLAUSE AND PROVIDING
FOR PUBLICATION.
WHEREAS, Pioneer Natural Gas Company has heretofore submitted a request
for au:t..'lorization to adjust its rates charged for natural gas and natural gas ser-
vice within the City of Lubbock in accordance with increases or decreases in its
average monthly cost of gas; and ' .
WHEREAS, after considering all pertinent information submitted by Pioneer
Natural Gas Company and by all other interested persons desiring to be heard,
the City Council finds the following authorization for cost of gas adjustment shoul
be placed in effect in order to enable Pioneer Natural Gas Company to make a
fair and reasonable return on its investments in the City of Lubbock; NOW
THEREFORE ..
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK, TEXA
SECTION 1. THAT the rates to be charged by Pioneer Natural Gas Company
for the sale of natural gas and natural gas service in the City of Lubbock shall be
those rates heretofore approved by Ordinance, adjusted in the following manner:
Each month Pioneer Natural Gas Company shall notify the City of the averag
cost of gas per Mcf at 13. 6 psia for its West Texas Transmission System
during the previous month. Said notice shall be filed with the City Secretar ,
with additional copies of such notice to be sent to such City officials as may
be requested. The cost of gas shown in such notice shall be broken down
into the four classifications hereinafter described. Unless the City notifies
Pioneer Natural Gas Company within ten (10) days of receipt of said notice
that it does not accept such notice of cost as being correct (and the City
reserves complete discretion to accept or reject such notice of cost for any
reason), the rates per Mcf to be charged by Pioneer Natural Gas Company
for all bills rendered on or after the first day of the month following expira-
tion of the said ten (10) day period shall be adjusted up or down to the neares
• 01¢ by which the average monthly cost of gas to Pioneer Natural Gas Com-
pany for its West Texas Transmission System is more than or less than
15. 97t per Mcf at 13.6 psia (17. 2t per Mcf at 14. 65 psia) .. subject to the pr
visions of the succeeding sections hereof.
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K .T•F.W
SECTION 2. THAT for the purpose of determining the cost of gas and the cost
of gas adjustments applicable above, the term "average cost of gas 11 is the total of
the following amounts divided by the volume of gas:
1. Amounts paid for the volumes purchased at wellheads, at field lines,
at gasoline plant outlets and at transmission lines under the provisions
of the applicable congr.acts involved including recoupment or amorti-
zation of prepayments. It also includes volumes in excess of receipts
under gas exchange agreements and storage gas withdrawals in excess
of injections during the period at the applicable costs.
2. Interest charged at the prime rate in effect on the first day of each
month or the actual rate, whichever is less, upon funds advanced for
gas development or dedicated volum-based upon the outstanding
portion of such advancements.
3. Amounts paid for delivery of gas into Pioneer's West Texas System
in situations where the supplier cannot make delivery into Pioneer's
lines thus reflecting the cost of gas at the initial point of delivery
into Pioneer's West Texas System.
4. Amortization over a five (5) year period of funds advanced for gas
supply development which is nonproductive.
The portion of any adjustment increase authorized in Section 1 hereof, which is
attributable to items number 2 and number 4 described in this section, shall never
exceed a combined total of 1 tt per Mcf per month.
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SECTION 3. By March 1 of each year Pioneer Natural Gas Company shall fur-
nish the City with the detail of gas purchased for its West Texas Transmission
System during the previous calendar year as filed with the Railroad Commission
of Texas. The City may, as it deems desirable, examine the books and records
of Pioneer Natural Gas Company and make audits to determine the accuracy of the
cost of gas purchased by Pioneer Natural Gas Company for its West Texas Trans-
mission System.
SECTION 4. THAT the "cost of gas adjustment" authorized by this Ordinance
shall in nowise be construed as an abrogation or waiver (by contract or otherwise)
of the rate making powers and prerogatives of the City.:G'f Lubbock granted by
charter, statutes, or franchise provisions. This Ordinance shall be reviewed by thE
City Council two years from its effective dtte.
SECTION 5. THAT should any section, paragraph, sentence, clause, phrase,
or word of this Ordinance be declared unconstitutional or invalid for any reason,
the remainder of this Ordinance shall not be affected thereby.
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SECTION 6. THAT the City Secretary is hereby authorized to cause publicatio
f the descriptive caption of this Ordinance as an alternative method provided by
aw.
ANn IT IS SO ORDERED.
Passed by the Council on first reading this 28th day of February , 1974.
Passed by ;the Council on second reading this 14th day Rf _Mi_r_ch ____ , 1974.
TTEST:
Treva Philli"">s. ---··!:'"''
PPROVED AS TO';:---·M:
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MAYOR