55-1,104. Commission review of fees, terms, practices; complaint; procedure. - Kansas Statutes

55-1,104

Chapter 55.--OIL AND GAS Article 1.--OIL AND GAS WELLS; REGULATORY PROVISIONS

      55-1,104.   Commission review of fees, terms,practices; complaint; procedure.(a) The commission, in its discretion, may at any time review a fee, term orpractice being used by a person offering gas gathering services to ascertainwhether a violation of K.S.A. 55-1,103 has occurred. Upon such review, thecommission may initiate a proceeding to determine whether a violation of K.S.A.55-1,103 has occurred. Upon notice and an opportunity for hearing in accordancewith the Kansas administrative procedure act, the commission shall haveauthority to order the remediation of any violation of K.S.A. 55-1,103 that thecommission finds has occurred.

      (b)   Any consumer of gas gathering services, any person seeking directpurchase of natural gas at the wellhead or any royalty owner, may request thecommission to investigate and initiate proceedings to review a fee, term orpractice being used by a person offering gas gathering services. As a conditionto formal commission action, the person requesting commission action must firstfile a complaint that includes:

      (1)   A statement that the complainant has presented the complaint, in writing,to the person offering gas gathering services and included a request for ameeting with such person to discuss the matter;

      (2)   a copy of the document described in subsection (b)(1);

      (3)   a statement that the requested meeting took place or the person offeringgas gathering services refused to meet with the complainant;

      (4)   detailed factual statement indicating how the fee, term or practiceviolates K.S.A. 55-1,103;

      (5)   a statement of the precise remedy being requested that will make thefee, term or practice consistent with the provisions of K.S.A. 55-1,103;

      (6)   if the complainant is a producer of natural gas, a copy of the analysisof the complainant's natural gas, including the nitrogen, carbon dioxide,hydrogen sulfide, water and other contaminant content; the amount of volume;and the amount of pressure at the wellhead; and

      (7)   if available, a map showing the location of the affected wells and allgas gathering systems in the area.

      (c)   The commission may resolve the complaint by use of an informal procedureestablished by the commission pursuant to rules and regulations adopted by thecommission or the commission may conduct a formal hearing and take evidence asnecessary to determine the merits of the complaint. If the commission uses aninformal procedure and the complaint is not resolved within 60 days after thecomplaint is filed, the commission shall conduct a formal hearing on thecomplaint. The hearing shall be conducted and notice given in accordance withthe Kansas administrative procedure act. Upon such hearing, the commissionshall have authority to order the remediation of any violations of K.S.A.55-1,103, to the extent necessary for remediation as to the aggrieved personwith respect to the particular violation.

      (d)   In evaluating a fee or term, or in establishing a reasonable fee orterm, the commission is not required to engage in cost-of-service ratemaking orany other form of ratemaking. Instead, the commission can employ any form ofanalysis and remedy that is designed to accomplish the goals of this act whilerespecting the legitimate property interests of the person offering the gasgathering services.

      (e)   Any natural gas producer using the gas gathering facilities of a personengaged in activities described in subsection (a)(1)(A) or (B) of K.S.A.55-1,101 may request the commission to investigate and initiate proceedings toreview the fees, terms and practices of the person engaged in such activities.The commission shall conduct such investigation and proceeding in the samemanner as provided by this section for complaints filed pursuant to subsection(b) and may order the remediation of any violation of subsection (b) of K.S.A.55-1,103 that the commission finds would exist except for the exemptionprovided by subsection (a)(1)(A) or (B) of K.S.A. 55-1,101.

      (f)   The commission shall maintain a publicized telephone number tofacilitate the filing of informal complaints pursuant to subsection (b) or (e).

      (g)   The commission shall adopt such rules and regulations as the commissiondetermines reasonably necessary to prevent abuse of the complaint procedureprovided for by this section. Such rules and regulations shall includeprovisions to prevent delay of the proceedings that may damage a party'sability to pursue or defend the complaint.

      History:   L. 1997, ch. 132, § 25; May 8.