The uninitiated might be forgiven for thinking that oil and gas pipeline operations are similar. After all, they’re just long steel tubes that move hydrocarbons from one point to another, right? Well, that’s about where the similarity ends. While the oil and gas pipeline sectors are interlinked, they developed in quite distinctly different ways and that’s led to a vast chasm in both the way the two are regulated and how their transportation rates are determined. Bridging that gap between oil and gas can be a perilous and chaotic endeavor because you’ve got to consider how each sector evolved over time and the separate sets of rules that have been established to form today’s competitive marketplace. In today’s blog, we continue our review of oil and gas pipelines and how their separate histories led to the current differences in pipeline rate structures.
In Part 1, we discussed how crude oil and natural gas pipeline regulation in the U.S. developed. Both sectors have been under the purview of the Federal Energy Regulatory Commission (FERC) since the 1970s. Oil pipeline oversight by the federal government started with the enactment of the Hepburn Act of 1906, which modified the Interstate Commerce Act, adding oil pipelines to the list of the Interstate Commerce Commission’s (ICC) concerns. The ICC’s primary focus was on providing producers with common-carrier access to crude-carrying pipelines. Federal regulation of natural gas pipelines didn’t kick in until 1938 with the enactment of the Natural Gas Act (NGA), which put regulation of gas pipelines in the hands of the Federal Power Commission (FPC), an entity that was created in the 1920s to regulate interstate electricity transactions. The Energy Organization Act of 1977 transformed the FPC into the FERC, which also became responsible for the regulation of oil pipelines. That’s pretty much how it’s been ever since, though the Energy Policy Act of 1992 made some revisions to how FERC regulates oil pipelines.
The RBN NATGAS Haynesville is a weekly natural gas fundamentals analysis focused on supply, flow, and LNG-driven demand dynamics within the Haynesville basin.
What we didn’t delve into last time was natural gas pipeline regulation. Nor did we explain how the actual agency-level regulation of oil pipelines has worked out. Today, we will start with the gas side and come back to oil regulation in the next part. As we said in our previous blog, by the late 1930s, natural gas pipeline development was taking off, but gas midstreamers faced the challenge of reconciling the different sets of laws and rules for each state that their pipelines traversed (and being long and skinny, that was a lot of states). For example, an upstream state could actually find ways to swipe gas from a downstream state. So as part of his New Deal, President Franklin D. Roosevelt, seeing that this was an important interstate activity, got the Natural Gas Act of 1938 (NGA) passed, providing a detailed regulatory structure, custom-designed for interstate natural gas pipelines. The NGA was to be administered by the FPC (see timeline in Figure 1).
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About the song
"Everyday People" was written by Sly Stone and appears as the first song on side two of Sly and the Family Stone's fourth studio album, Stand! Released as a single in November 1968, the song went to #1 on both the Billboard Soul Singles and Billboard Hot 100 Singles charts. It was the first #1 single for the band. With its lyric of "different strokes for different folks," the song is a call for peace and equality for different races and social groups. That lyric became a popular catchphrase in modern culture and would later inspire the name of the hit television series, Diff’rent Strokes.
San Francisco's Sly and the Family Stone, along with Los Angeles rock band Love, were the first integrated rock bands to have albums out. Sly and the Family Stone also featured two women in the group: Rose Stone and Cynthia Robinson. "Everyday People" is one of the most covered songs by Sly and the Family Stone, with artists such as Aretha Franklin, Joan Jett, The Staple Singers, and Pearl Jam recording the song. Personnel on the record were: Sly Stone (vocals), Rose Stone (vocals, keyboards), Freddie Stone (vocals, guitar), Larry Graham (vocals, bass), Gregg Errico (drums, vocals), Jerry Marini (sax, vocals), and Cynthia Robinson (trumpet, vocal ad-libs).
Stand! was recorded in 1968 and 1969 at Pacific High Recording Studios in San Francisco, with Sly Stone producing. Released in May 1969, the album went to #3 on the Billboard Top R&B chart and #13 on the Billboard Top 200 Albums chart. It has been certified Platinum by the Recording Industry Association of America. Two singles were released from the album. Stand! was selected by the Library of Congress for inclusion in the National Recording Registry.
Sly and the Family Stone were an American soul/rock band formed in San Francisco in 1966 by Sly Stone. Sly was already a popular DJ and record producer in the Bay Area when he put the band together. The original band was active until 1975, when internal problems led to their dissolution. Sly Stone retired from the music business in 1987. The group released 11 studio albums and 40 singles. The band left a strong impression after its appearance at the Woodstock music festival in 1969 and are featured in the film and soundtrack of that historical event as well as the 40th Anniversary Edition. Eighteen people passed through Sly and the Family Stone until its final breakup. The work of the band greatly influenced the sound of American funk, soul, pop, R&B, and hip-hop music. The band was inducted into the Rock and Roll Hall of Fame in 1993 and the Vocal Group Hall of Fame in 2007.
