Section 167: Natural gas prices for the strategic sectors and gas distributors.

1 The Authority shall, in accordance with this section and for each year, determine the domestic base price under the Third Schedule to this Act, for the purpose of determining the prices for the power sector, commercial sector and gas based industries. [Third Schedule]

2 The Authority shall continue to determine the prices referred to under subsection
(1) , if in its opinion, the control of prices for natural gas for the strategic sector is required.

3 The price control and the corresponding role of the domestic gas aggregator shall not be required, where the -
a entire domestic gas demand requirement under section 173 (2)
is covered by contracts under sections 110 (2) and 173 (3) of this Act; or
b domestic market for natural gas is largely characterised by free market based contracting for natural gas between willing buyers and willing sellers, based on criteria established by the Authority in consultation with the stakeholders and at such time the provisions of subsections (4), (5), (6) and (7) and section 168 shall no longer be applicable and the criteria under this subsection may include that certain classes of wholesale customers, but not all, of the strategic sectors will no longer be subject to price controls as part of an ongoing process towards full free market conditions.

4 The aggregate gas price for a month shall be the price calculated based on the procedures established by the domestic gas aggregator on the basis of the prices determined by the Authority under subsection (1).

5 The price of marketable natural gas applicable to the power sector shall be the domestic base price at the marketable natural gas delivery point.

6 The price of marketable natural gas applicable to the commercial sector shall be the domestic base price at the marketable natural gas delivery point plus US $0.50 per MMBtu.

7 Gas distributors shall not be part of the strategic sectors and shall negotiate the supply and pricing of their natural gas directly, provided that the applicable price for gas distributors for the marketable natural gas at the marketable gas delivery point shall not exceed that of the commercial sector under subsection (6).

8 Where applicable, wholesale gas suppliers, the wholesale customers of the strategic sectors and gas distributors shall pay for the transportation cost of the marketable natural gas from the marketable natural gas delivery point to the facilities of the wholesale customers.

9 The wholesale gas suppliers, wholesale customers of the strategic sectors and gas distributors shall, for the purpose of transportation, have the option to -
a use the gas transportation network applicable to their geographical areas; or
b obtain a gas transportation licence in order to transport their natural gas connecting to the gas transportation network, another existing gas transportation pipeline or directly to a marketable natural gas delivery point.

10 Each producer client shall, for any month, receive from the escrow account of the domestic gas aggregator an amount that is equal to the aggregate gas price multiplied by the customer client volume that was paid for such producer client in such month by the customer client.