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FERC Accuses Total of Manipulating Gas Prices in Southwest USA

On September 21, the staff of the Office of Enforcement Federal Energy Regulatory Commission (FERC) alleged that Total Gas & Power, North America (TGPNA), had manipulated the natural gas market in America’s Southwest between June 2009 and June 2012.

TGPNA – a unit of Paris-based Total S.A. – has been engaged in natural gas physical and financial trading and marketing activities in the United States since 1990.

Following a private investigation, the federal agency’s enforcement team has accused the Houston-based company’s West Desk traders and supervisors, Therese Nguyen and Aaron Hall, of “devising and executing a scheme” – and directing other traders to do so, as well – in violation of the Natural Gas Act and of FERC’s Anti-Manipulation Rule.

FERC staff contends that the scheme involved “making largely uneconomic trades for physical natural gas during bidweek designed to move indexed market prices in a way that benefited the company’s related positions.” Staff also alleges that the West Desk implemented the bidweek scheme at least 38 times during the period of interest.

The French oil company issued a written denial, saying it was convinced that no Total employee “committed any of the FERC’s allegations,” according to the Wall Street Journal’s blog. There is no word yet on what FERC’s next move might be, or what penalties might be under consideration.

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