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3. BUTANE

(1) Coverage

This allocation program applies to butane and certain mixtures containing butane produced in or imported into the United States.

Butane in cylinders with a capacity of 100 pounds of less is excluded from this program, provided that the cylinders are not manifolded at the time of sale.

(2) Allocation Levels and Priorities

The regulations provide for allocation

levels of 100%

of current requirements for the following uses:

Agricultural production

Dispensing stations and resellers which sell bottled
gas in quantities up to 15,000 gallons per year

Emergency services

Energy production

Petrochemical production

Sanitation services

Telecommunication services

Passenger transportation services
Medical and nursing buildings.

The supply of butane for agricultural production will not be subject to any pro rata reduction that otherwise might occur when a supplier or reseller has a National Allocation Fraction of less than 1.0.

For other end-users of butane, allocations are based on the amount of propane consumed during the base period, which is the corresponding quarter of 1972. Levels of allocation

are:

(3)

Residential use

-

95% of base period consumption

Commercial use -- 90% of base period consumption or
210,000 gallons per year, whichever is less on
approximately a monthly ratable basis.

available

-

Industrial use where no substitute for butane is
100% of base period consumption or the
lesser of; (a) standby volumes consumed during the base
period; or (b) 210,000 gallons per year. Delivery must be
on approximately a monthly ratable basis.

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The use of butane for peak shaving by gas utilities is
limited to the volumes of butane equivalent to those
amounts contracted for or purchased for delivery
during the base period.

Supplier/Purchaser Relationships

All suppliers of butane must supply all of their purchasers of record during the base period, and all of the purchasers assigned to them by the FEO, for the duration of this program.

Suppliers, wholesale purchasers, retailers, and end-users who during all or part of the base period had either non-existent or exceptional usage rates for butane or who have had substantial increases in butane requirements since the base period may apply for an assignment of a supplier or an adjusted base period volume through the FEO National Office.

The FEO may order the sale of butane by suppliers to other suppliers or end-users to alleviate imbalances, transfer butane from one area to another, reassign purchasers, or make other adjustments as necessary to achieve a more equitable distribution.

(4) Method of Allocation and Distribution

Butane suppliers and resellers must provide butane for priority requirements of their priority customers to whom they sold, or with whom they had a contract to sell, during the base period. Nonpriority end-users will receive an allocation on a pro rata basis, after all priority users have been supplied. In the event that a supplier's or reseller's immediate supplies are insufficient to meet the needs of priority users, he must supply all priority users on a pro rata basis.

(5) State Set-Aside

There is no state set-aside for butane.

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The motor gasoline program establishes rules for the mandatory allocation of gasoline at the wholesale level (i.e., suppliers and wholesale purchasers). No provisions are provided either for allocations among retail-level end-users or for rationing at this time.

All motor gasoline produced in or imported into the United States is covered. Aviation gasoline is specifically excepted from the motor gasoline program, and is covered elsewhere in the Mandatory Aviation Fuels Allocation Program.

(2) Allocation Levels and Priorities

The regulations set priority motor gasoline allocation levels at 100% of current requirements for the following bulk end users.

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The allocation level for all other business activities is 100% of use during the Base Period, which is the corresponding month of 1972. There are no allocation levels for any end users other than those specified above.

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