15 U.S.C. § 3431

Coordination with the Natural Gas Act

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(a) Jurisdiction of the Commission under the Natural Gas Act(1) Sales(A) Application to first sales

For purposes of section 1(b) of the Natural Gas Act [15 U.S.C. 717(b)], the provisions of the Natural Gas Act [15 U.S.C. 717 et seq.], and the jurisdiction of the Commission under such Act shall not apply to any natural gas solely by reason of any first sale of such natural gas.

(B) Authorized sales or assignmentsFor purposes of section 1(b) of the Natural Gas Act [15 U.S.C. 717(b)], the provisions of the Natural Gas Act [15 U.S.C. 717 et seq.] and the jurisdiction of the Commission under such Act shall not apply by reason of any sale of natural gas—(i) authorized under section 3362(a) or 3371(b) of this title; or(ii) pursuant to any assigned 11 So in original. Probably should be “assignment”. authorized under section 3372(a) of this title.(C) Natural-gas company

For purposes of the Natural Gas Act [15 U.S.C. 717 et seq.], the term “natural-gas company” (as defined in section 2(6) of such Act [15 U.S.C. 717a(6) et seq.]) shall not include any person by reason of, or with respect to, any sale of natural gas if the provisions of the Natural Gas Act and the jurisdiction of the Commission do not apply to such sale solely by reason of subparagraph (A) or (B) of this paragraph.

(2) Transportation(A) Jurisdiction of the CommissionFor purposes of section 1(b) of the Natural Gas Act [15 U.S.C. 717(b)] the provisions of such Act [15 U.S.C. 717 et seq.] and the jurisdiction of the Commission under such Act shall not apply to any transportation in interstate commerce of natural gas if such transportation is—(i) pursuant to any order under section 3362(c) or section 3363(b), (c), (d), or (h) of this title; or(ii) authorized by the Commission under section 3371(a) of this title.(B) Natural-gas company

For purposes of the Natural Gas Act [15 U.S.C. 717 et seq.], the term “natural-gas company” (as defined in section 2(6) of such Act [15 U.S.C. 717a(6)]) shall not include any person by reason of, or with respect to, any transportation of natural gas if the provisions of the Natural Gas Act and the jurisdiction of the Commission under the Natural Gas Act do not apply to such transportation by reason of subparagraph (A) of this paragraph.

(b) Charges deemed just and reasonable(1) Sales(A) First sales

Except as otherwise provided in this subsection, for purposes of sections 4 and 5 of the Natural Gas Act, any amount paid in any first sale of natural gas shall be deemed to be just and reasonable.

(B) Emergency sales

For purposes of sections 4 and 5 of the Natural Gas Act [15 U.S.C. 717c, 717d], any amount paid in any sale authorized under section 3362(a) of this title shall be deemed to be just and reasonable if such amount does not exceed the fair and equitable price established under such section and applicable to such sale.

For purposes of sections 4 and 5 of the Natural Gas Act [15 U.S.C. 717c, 717d] any amount paid in any sale authorized by the Commission under section 3371(b) of this title shall be deemed to be just and reasonable if such amount does not exceed the fair and equitable price established by the Commission and applicable to such sale.

(D) Assignments

For purposes of sections 4 and 5 of the Natural Gas Act [15 U.S.C. 717c, 717d], any amount paid pursuant to the terms of any contract with respect to that portion of which the Commission has authorized an assignment authorized under section 3372(a) of this title shall be deemed to be just and reasonable.

(E) Affiliated entities limitation

For purposes of paragraph (1), in the case of any first sale between any interstate pipeline and any affiliate of such pipeline, any amount paid in any first sale shall be deemed to be just and reasonable if, in addition to satisfying the requirements of such paragraph, such amount does not exceed the amount paid in comparable first sales between persons not affiliated with such interstate pipeline.

(2) Other charges(A) Allocation

For purposes of sections 4 and 5 of the Natural Gas Act [15 U.S.C. 717c, 717d], any amount paid by any interstate pipeline for transportation, storage, delivery or other services provided pursuant to any order under section 3363(b), (c), or (d) of this title shall be deemed to be just and reasonable if such amount is prescribed by the President under section 3363(h)(1) of this title.

(B) Transportation

For purposes of sections 4 and 5 of the Natural Gas Act [15 U.S.C. 717c, 717d], any amount paid by any interstate pipeline for any transportation authorized by the Commission under section 3371(a) of this title shall be deemed to be just and reasonable if such amount does not exceed that approved by the Commission under such section.

The Commission may not deny, or condition the grant of, any certificate under section 7 of the Natural Gas Act [15 U.S.C. 717f] based upon the amount paid in any sale of natural gas, if such amount is deemed to be just and reasonable under subsection (b) of this section.

(2) Recovery of just and reasonable prices paid

For purposes of sections 4 and 5 of the Natural Gas Act [15 U.S.C. 717c, 717d], the Commission may not deny any interstate pipeline recovery of any amount paid with respect to any purchase of natural gas if, under subsection (b) of this section, such amount is deemed to be just and reasonable for purposes of sections 4 and 5 of such Act, except to the extent the Commission determines that the amount paid was excessive due to fraud, abuse, or similar grounds.

(Pub. L. 95–621, title VI, § 601, Nov. 9, 1978, 92 Stat. 3409; Pub. L. 101–60, § 3(a)(7), (b)(7), July 26, 1989, 103 Stat. 158, 159.)Editorial NotesReferences in Text

The Natural Gas Act, referred to in subsec. (a)(1), (2)(A), (B), is act June 21, 1938, ch. 556, 52 Stat. 821, which is classified generally to chapter 15B (§ 717 et seq.) of this title. For complete classification of this act to the Code, see section 717w of this title and Tables.

Amendments

1989—Subsec. (a)(1)(A). Pub. L. 101–60, § 3(b)(7)(A), in heading substituted “Application to first sales” for “Natural gas not committed or dedicated” and amended text generally. Prior to amendment, text read as follows: “For purposes of section 1(b) of the Natural Gas Act, effective on the first day of the first month beginning after November 9, 1978, the provisions of the Natural Gas Act and the jurisdiction of the Commission under such Act shall not apply to natural gas which was not committed or dedicated to interstate commerce as of November 8, 1978, solely by reason of any first sale of such natural gas.”

Subsec. (a)(1)(B). Pub. L. 101–60, § 3(b)(7)(B), (C), redesignated subpar. (C) as (B) and struck out former subpar. (B) which related to committed or dedicated natural gas which was high-cost natural gas, new natural gas, or natural gas produced from any new, onshore production well.

Subsec. (a)(1)(C). Pub. L. 101–60, § 3(b)(7)(C), (D), redesignated subpar. (D) as (C) and substituted “subparagraph (A) or (B)” for “subparagraph (A), (B), or (C)”. Former subpar. (C) redesignated (B).

Subsec. (a)(1)(D). Pub. L. 101–60, § 3(b)(7)(C), redesignated subpar. (D) as (C).

Subsec. (a)(1)(E). Pub. L. 101–60, § 3(b)(7)(B), struck out subpar. (E), “Certain additional natural gas”, which read as follows: “For purposes of section 1(b) of the Natural Gas Act, the provisions of the Natural Gas Act and the jurisdiction of the Commission under such Act shall not apply solely by reason of any first sale of natural gas which is committed or dedicated to interstate commerce as of July 25, 1989, and which is not subject to a maximum lawful price under part A of subchapter I of this chapter by reason of section 3331(f) of this title, effective as of the date such gas ceases to be subject to such maximum lawful price.”

Pub. L. 101–60, § 3(a)(7)(A), substituted “Certain additional natural gas” for “Alaskan natural gas” in heading and amended text generally. Prior to amendment, text read as follows: “Subparagraph (B)(ii) and (iii) shall not apply with respect to natural gas produced from the Prudhoe Bay unit of Alaska and transported through the transportation system approved under the Alaska Natural Gas Transportation Act of 1976.”

Subsec. (b)(1)(A). Pub. L. 101–60, § 3(b)(7)(E), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “Subject to paragraph (4), for purposes of sections 4 and 5 of the Natural Gas Act, any amount paid in any first sale of natural gas shall be deemed to be just and reasonable if—

“(i) such amount does not exceed the applicable maximum lawful price established under subchapter I of this chapter; or

“(ii) there is no applicable maximum lawful price solely by reason of the elimination of price controls pursuant to part B of subchapter I of this chapter.”

Subsec. (b)(1)(D). Pub. L. 101–60, § 3(b)(7)(F), struck out before period at end “if such amount does not exceed the applicable maximum lawful price established under subchapter I of this chapter”.

Subsec. (c)(2). Pub. L. 101–60, § 3(a)(7)(B), substituted “purchase of natural gas if, under subsection (b) of this section, such amount is deemed to be just and reasonable for purposes of sections 4 and 5 of such Act,” for “purchase of natural gas if—

“(A) under subsection (b) of this section, such amount is deemed to be just and reasonable for purposes of sections 4 and 5 of such Act, and

“(B) such recovery is not inconsistent with any requirement of any rule under section 3341 of this title (including any amendment under section 3342 of this title),”.

Statutory Notes and Related SubsidiariesEffective Date of 1989 Amendment

Amendment by section 3(b)(7) of Pub. L. 101–60 effective Jan. 1, 1993, see section 3(b) of Pub. L. 101–60, set out as a note under section 3372 of this title.

Notes of Decisions

Cited in 69 cases (2 in the last 5 years), 1980–2025 · leading case: E. & J. Gallo Winery v. Encana Corp., 503 F.3d 1027 (9th Cir. 2007).

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E. & J. Gallo Winery v. Encana Corp., 503 F.3d 1027 (9th Cir. 2007). · cites it 12× “" 15 U.S.C. § 3431 (b)(1)(A). (Sections 4 and 5 of the NGA, 15 U.”

Transcontinental Gas Pipe Line Corp. v. State Oil & Gas Bd., 474 U.S. 409 (1986). · cites it 8× “Appellees argue, however, that §§ 601(a)(1)(B)(i) and (ii), 15 U. S. C. §§ 3431 (a)(1)(B)(i) and (ii), stripped FERC of jurisdiction over the Harper Sand pool gas which was the subject of the Gas Board's Rule 48 order, thereby leaving the State free to regulate Transco's…”

Pub. Serv. Comm'n of NY v. Mid-Louisiana Gas Co., 463 U.S. 319 (1983). · cites it 4× “3410 , 15 U. S. C. § 3431 (b)(1)(A) (1976 ed., Supp.”

Transcontinental Gas Pipeline Corp. v. State Oil & Gas Bd., 457 So. 2d 1298 (Miss. 1984). · cites it 6× “Congress has declared that the first sale of deregulated gas is never made subject to the Natural Gas Act or to FERC's jurisdiction under that act, and "dedicated gas" which is determined to be deregulated gas ceases to be subject to the NGA or FERC's jurisdiction under the NGA.”

Nw. Cent. Pipeline Corp. v. State Corp. Comm'n of Kan., 489 U.S. 493 (1989). · cites it 2× “To encourage production, the NGPA took wellhead sales of “new” and “high-cost” gas outside the coverage of the NGA, § 601(a)(1)(B), 15 U. S. C. § 3431 (a) (1)(B), and provided instead for market-driven wellhead pricing, at first up to a high ceiling, and later with no ceiling.”

Breiding v. Eversource Energy, 939 F.3d 47 (1st Cir. 2019). “See 15 U.S.C. § 3431 (a)(1)(A). Accordingly, market forces dictate the wellhead price of natural gas.”

Cabot Corp. v. Brown, 754 S.W.2d 104 (Tex. 1987). · cites it 2× “§ 717 (b); see 15 U.S.C. § 3431 . In September 1967, Cabot and Transwestern applied for and obtained a Certificate of Public Convenience and Necessity from the FPC under the Natural Gas Act of 1938, 15 U.”

Associated Gas Distributors v. Fed. Energy Regulatory Comm'n, Texas E. Transmission Corp., Intervenor, 706 F.2d 344 (D.C. Cir. 1983). · cites it 4× “15 U.S.C. § 3431 (a)(1). The section states that the prices are deemed to be just and reasonable if they do not exceed the congressionally-mandated maximum lawful price or if the gas has been deregulated.”

Pennzoil Co. v. Fed. Energy Regulatory Comm'n, 645 F.2d 360 (5th Cir. 1981). “NGPA § 601(b)(1)(A), 15 U.S.C.A. § 3431 (b)(1)(A). Without deciding whether this deemed justness and reasonableness is for all purposes, see note 38 supra, it is sufficient to note that “just and reasonable” is a term of art in utility regulation generally meaning cost-based…”

Mid Louisiana Gas Co. v. Fed. Energy Regulatory Comm'n, 780 F.2d 1238 (5th Cir. 1986). · cites it 3× “Section 601 of the NGPA, 15 U.S.C. § 3431 , coordinates that Act with the NGA.”

United Distrib. Companies v. Fed. Energy Regulatory Comm'n, Windward Energy & Mktg. Co., Intervenors, 88 F.3d 1105 (D.C. Cir. 1996). “See NGPA § 601(a)(1)(A), (B), 15 U.S.C. § 3431 (a)(1)(A), (B); Pennzoil Co.”

Am. Gas Ass'n v. Fed. Energy Regulatory Comm'n, 912 F.2d 1496 (D.C. Cir. 1990). · cites it 6× “(The proportion of wellhead sales that is subject to FERC jurisdiction steadily declines, as Congress in the Natural Gas Policy Act eliminated such jurisdiction over what may loosely be characterized as “new” gas, which gradually increases as a share of the total as old gas is…”

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