Pinedale's Natural Gas Prices to Increase for 3rd Time Since July
Prices have more than doubled
by Rob Shaul

Pinedale Natural Gas announced last week that it has received approval from the Wyoming Public Service Commission to increase prices for a third time since July 2000. On January 23, 2001, the company increased natural gas prices from $11.87 per decatherm (Dth) to $15.31/Dth.

According to a company press release, the average customer in Pinedale uses 70 Dth per year. Thus, this latest price increase will cost the average residential consumer $241 per year in increased heating bills.

Last July, the company increased its price by $1.60/Dth. In October, the price rose by $2.65/Dth. All combined, the three price increases have resulted in a doubling of natural gas prices for residential consumers in Pinedale since this time last year. According to PNG company President Gilmer Mickey, the January 2000 price for natural gas in Pinedale was $7.62. As of January 23, 2001, the price is $15.31. If this price holds, the average residential customer in Pinedale will pay $1071.70 for natural gas in 2001.

A 400% increase in the wholesale price of natural gas is responsible for the price increases to consumers in Pinedale, says Mr. Mickey. However, he predicts that gas prices will drop steeply in the spring and level off at approximately four dollars lower than the current price.

The gas which supplies Pinedale comes from two wells just south of town on the Pinedale Anticline., but Pinedale's local supply is still subject to the nationwide market for natural gas. Wyoming's natural gas is traded on regional and national commodity markets, and thus the demand and price of gas in the rest of the country affects the price consumers pay in Wyoming.

Piney's Prices Have Also Risen

Questar Gas supplies natural gas to residents in southern Sublette County including Big Piney and Marbleton. According to Questar's Chad Jones, natural gas prices for Questar's Wyoming customers have risen 45% since last April.

That month, Questar increased natural gas prices 5%. This was followed by a 12% increase in October, and another 29% increase which took effect on January 1.

Even with these price increases, consumers in Big Piney and Marbleton are paying just $7.57 per decatherm for their natural gas, half as much as residents living in Pinedale, said Mr Jones.

Questar's customers benefit because the company purchases only 46% of its natural gas from the unregulated wholesale natural gas market. Most of the gas Questar sells comes from wells the company itself owns. This gas is delivered to customers at "cost of service" pricing, which is considerably lower than gas purchased on the wholesale market. <