Word: wellheads
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Dates: during 1970-1979
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...Americans flying over the deserts of the Middle East, it is a doleful sight: mile after mile of flaring wellhead fires burning off natural gas, a fuel that has become painfully scarce in many parts of the U.S. Equally bounteous reserves of gas exist in many other parts of the world, from Soviet Siberia to the marshy fields of Holland-and several of the nations with the biggest reserves must export gas if they are to tap the potential wealth, because their populations are too small to use all they have (see chart). Yet apart from a trickle of imports...
...really so bad? It does half of its job-regulating the rates charged by utilities for natural gas and for electricity that moves between states-without much trouble. The task in which the agency can please nobody is setting the wellhead price of natural gas produced in one state and burned in another. If the FPC holds down the price, gas producers (mainly big oil companies) berate the agency for not giving them an incentive to explore for new gas reserves. If the FPC lets prices rise, consumers set up a howl-and some 45 million American homes and businesses...
...become the most advanced country on earth. Yet many Americans have come to view the industry with suspicion, especially since the rapid runup in oil prices that followed the 1973 Arab oil embargo. Critics contend that the major companies' total control of all aspects of their business, from wellhead to gas pump, has given the industry too much power to manipulate supplies and prices and reap excessive profits at the expense of consumers. During the past year or so, the efforts of congressional Democrats to curb the companies' clout and inject more competition into the industry has gained...
...problem is not technical or even economic. Now that average wellhead prices are above 50? per 1,000 cu. ft., the value of the new find is at least $500 million per trillion cu. ft. in Alaska, and perhaps three times that much delivered to the consumer. Thus money can be raised to transport North Slope gas. Indeed, two competing proposals-each of which would rank as among the very biggest private construction projects in history-have already been developed by competing energy companies...
...power to press antitrust charges. To date, Engman's legal staff has brought no fewer than 31 antitrust suits, most notably its 1973 complaint against Exxon and seven other big U.S. oil companies. The FTC's argument: the firms control so much of the petroleum business-from wellhead through refinery to gasoline pump-that they effectively manage the market...