FOR IMMEDIATE RELEASE                                          AT
THURSDAY, JANUARY 12, 1995                         (202) 616-2771
                                               TDD (202) 514-1888

 JUSTICE DEPARTMENT SETTLES CASE AGAINST EL PASO NATURAL GAS CO.


     WASHINGTON, D.C. -- El Paso Natural Gas Company, which
operates the largest gas pipeline system in the San Juan Basin of
New Mexico and Colorado, agreed today to settle an antitrust case
that will prevent it from requiring gas well owners to purchase
metering equipment along with natural gas gathering services from
El Paso.  The settlement could lower the cost of natural gas
production saving millions of dollars.
     In a complaint filed today in U.S. District Court in
Washington, the Department of Justice's Antitrust Division
alleged that El Paso required owners of gas wells that have
little economic choice but to use El Paso's natural gas gathering
system also to purchase El Paso's meter installation.  At the
same time, a proposed consent decree was filed, that if approved
by the court, would settle the suit.  
     Meter installation consists of the services necessary to
connect a well to El Paso's gathering system, including the
construction and installation of metering equipment and the line
used to connect the well to the gathering system.  
     The complaint also alleges that the effect of the illegal
arrangement has been to raise prices for meter installation and,
in many instances, to slow the pace at which the installation is
completed.  According to the Department, competition could save
well owners thousands of dollars on each installation and weeks
of time in bringing their natural gas to market. 
     Under the proposed settlement, gas producers in the San Juan
Basin will now be free to choose their own contractor to
construct the well connection rather than pay El Paso for the
service.  The settlement also assures that El Paso will not
impose standards that give it an advantage over others who could
provide well connection services to well owners.
     Assistant Attorney General Anne K. Bingaman in charge of the
Antitrust Division, said, "Keeping down the costs of basic energy
sources, such as natural gas, is crucial to the health of our
nation's economy.  This settlement will inject competition, and
could lower the cost of natural gas production in the San Juan
Basin by millions of dollars over its term. 
     "Changes in regulation of energy industries have created new
opportunities for competition to lower prices and improve service
for consumers.  We will not allow these benefits to be
jeopardized by anticompetitive conduct."
     The San Juan Basin of New Mexico and Colorado are one of the
nation's major natural gas production areas.  
     To become effective, today's settlement must be approved by
the court following the expiration of a 60-day comment period as
required by the Antitrust Procedures and Penalties Act.  The
proposed consent decree, along with the Department's competitive
impact statement, will be published in the Federal Register and
any person may submit written comments concerning the proposed
decree to Roger Fones, Chief, Transportation, Energy and
Agriculture Section, Antitrust Division, U.S. Department of
Justice, 555 4th Street, N.W., 9th Floor, Washington, D.C. 
20001.
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95-022