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be "deposits" of gas with Lo-Vaca which could be "withdrawn" years <br />later at the "deposit" price. In fact, such deals are simply long- <br />term supply contracts which should be suspended on exactly the same <br />basis that all other Lo-Vaca contracts have been suspended. But <br />because the Railroad Commission has failed in its duty to eliminate <br />this blatant discrimination in natural gas prices, Texas consumers <br />are paying, through their gas bills, for purchases by Lo-Vaca at <br />prices up to two dollars ($2.00) per thousand cubic feet (Mcf) of <br />natural gas to be, in turn, delivered to Amoco at twenty cents ($0.20) <br />-- a one -thousand (1,000) per cent discount price. <br />V. <br />These "banking" deals are not paid for by Lo-Vaca. Ordinary <br />consumers are forced to pay prices for gas based not on contracts <br />made with Lo-Vaca in the nineteen -fifties and sixties, but at prices <br />• <br />based, <br />in turn, upon the prices Lo-Vaca <br />itself <br />currently <br />pays to <br />natural <br />gas producers, and the consumer's <br />price <br />pays for <br />all gas <br />purchased by Lo-Vaca -- including the gas purchased for two dollars <br />($2.00) for sale at thousand per cent discounts to Amoco and the <br />other "banking" customers. The end result, as set out above, is <br />that the consumer is paying $130,000 per day -- which then is funneled <br />straight through the Lo-Vaca treasury to these "banking" customers. <br />VI. <br />There is no doubt that gas prices must rise in these days of <br />increasing costs and declining supplies. But allowing an incredible <br />giveaway of natural gas at prices subsidized by Texas consumers cannot <br />be tolerated. <br />WHEREFORE, petitioner respectfully requests that this governing <br />body file before the Texas Railroad Commission a formal request for <br />the immediate termination of such "banking" deals; and that it direct <br />its mayor and other city officials to pursue such request to the end <br />that natural gas rate discrimination be eliminated from Railroad <br />Commission - regulated gas rates. <br />OF COUNSEL: <br />O'Rourke, Lawler, & Coleman <br />•The Old Cotton Exchange <br />202 Travis, Number 310 <br />Houston, Texas 77002 <br />713/224-4640 <br />Respectfully submitted, <br />TERENCE L. O'ROURKE <br />