Northern Natural Gas Co. v. State Corp. Commission

• Decision Date: 31 August 1961
• Docket Number: No. 42128,42128
• Parties: , 40 P.U.R.3d 338 NORTHERN NATURAL GAS COMPANY, Appellant, v. STATE CORPORATION COMMISSION, Appellees.
• Court: Kansas Supreme Court

Page 668

364 P.2d 668

188 Kan. 624, 40 P.U.R.3d 338

NORTHERN NATURAL GAS COMPANY, Appellant, v. STATE CORPORATION COMMISSION, Appellees.

No. 42128.

Supreme Court of Kansas.

Aug. 31, 1961.

Mark H. Adams, II, Wichita, argued the cause, and Mark H. Adams, Charles E. Jones, William I. Robinson, J. Ashford Manka, Clifford L. Malone, John S. Seeber and Floyd E. Jensen, Wichita, Lawrence I. Shaw, F. Vinson Roach, and Patrick J. McCarthy, Omaha, Neb., Ray H. Calihan, Logan N. Green, Daniel R. Hopkins and Ray H. Calihan, Jr., Garden City, were with him on the briefs, for appellant.

Charles C. McCarter, Gen. Counsel, Wichita, argued the cause, and S. F. Flecker, Asst. Gen. Counsel, Topeka, was with him on the briefs, for appellee.

JACKSON, Justice.

In its motion for rehearing Northern disclaims the position of contending that our gas statute G.S.1959 Supp. 55-703 does not require ratable production of gas from a common source. It says the question is whether the statute also requires ratable purchases of gas. It then warns the court not to invade the jurisdiction of the Federal Power Commission by dealing with purchasers, citing Phillips Petroleum Co. v. State of Wisconsin, 347 U.S. 672, 74 S.Ct. 794, 98 L.Ed. 1035; Natural Gas Co. v. Panoma Corp., 349 U.S. 44, 75 S.Ct. 576, 99 L.Ed. 866; Deep South Oil Co. of Texas v. Federal Power Comm., 5 Cir., 247 F.2d 882; Saturn Oil & Gas Company v. Federal Power Comm., 10 Cir., 250 F.2d 61, certiorari denied 355 U.S. 956, 78 S.Ct. 542, 2 L.Ed.2d 532; Cities Service Gas Co. v. State Corporation Commission, 180 Kan. 454, 304 P.2d 528, reversed 355 U.S. 391, 78 S.Ct. 381, 2 L.Ed.2d 355, and Cities Service Gas Co. v. State Corporation Commission, 184 Kan. 540, 337 P.2d 640.

We had read those cases before the opinion in this case was announced, and we believe those cases all dealt with the question of the power to regulate the price of gas. As we tried to point out in the opinion as filed, this case in no way involves the price of gas. Northern studiously avoids that fact. Moreover, the ratable taking order does not regulate to total amount of gas which Northern may take. We fail to see how the order affects interstate commerce in any way.

Northern magnanimously states that the state may control the ratable production of natural gas, but fails to inform us how this can be done unless the producer can find a 'taker' for his gas.

It is not important in this case that the purchaser has a contract to purchase the gas at a price, which we will assume is subject to the regulation and jurisdiction of the Federal Power Commission, but the only important matter is that the 'taker' take gas so that it may be produced. This case involves nothing to our knowledge which has anything to do with the price paid by the purchaser for gas, nor how much gas he buys. The only matter here involved is whether the taker must take ratably from all wells to which he is connected and thus preserve the rights of the land owners. ¹ We again refer to the statement of Professor Summers of the University of Illinois School of Law set out in the original opinion to show that ratable production...