regulatory intervention and representation
FGU monitors and intervenes, on behalf of its members, in certain Federal Energy Regulatory Commission ("FERC") proceedings dealing with filings that affect the pipeline's rates and services to FGU and its members. Joint regulatory representation has provided substantial cost savings to FGU and its members, but the more significant benefit is derived from being one of the largest shippers on the FGT pipeline. As such, FGU enjoys a stronger negotiating position with the pipeline than each of its members would have independently.
Most of the natural gas that is provided by FGU to its members is transported on the FGT pipeline system. During May 2002 Gulfstream Natural Gas System, L.L.C. ("Gulfstream") placed into service an additional pipeline into Florida. FGU, through its members, has firm transportation capacity on Gulfstream; however, FGU expects to continue to ship most of its gas on FGT, but as price and availability permit will ship gas on the Gulfstream pipeline. Both FGT and Gulfstream are categorized as interstate pipelines and are therefore subject to regulation by the FERC.