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plants, and the Mentone Pipeline System, Gomez Pipeline System,
Maverick County Pipeline System, Rhoda Walker Pipeline System,
and Panola County Pipeline System, which gathered gas containing
little or no NGLs (termed “lean gas”) for delivery to purchasers’
transmission pipelines. The Panola and Rhoda Walker Systems
provided compression and dehydration services. The Gomez and
Mentone Systems provided dehydration services.
The Texas gathering systems included more than 1,100 miles
of feeder, lateral, and trunk lines. Clajon, via the Texas
gathering systems, purchased and transported gas from 190 third-
party gas producers and more than 1,000 wells.
Clajon did not own any oil or natural gas reserves and did
not own an economic interest in any well connected to the Texas
gathering systems.
Clajon’s Contractual Relationships
During the audit years, gas flowed through the Texas
gathering systems under the following types of contracts:
wellhead purchase contracts, gas processing contracts, and gas
transportation contracts.
Under a wellhead purchase contract, Clajon purchases a
producer’s gas at a meter located at the producer’s well. The
price may be fixed, or it may be calculated based upon the price
received by Clajon for residue gas at the tailgate of the gas
processing plant.
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Last modified: May 25, 2011