Newspaper article THE JOURNAL RECORD

'Firestone Crisis' Sounds Alarm at Council Meeting

Newspaper article THE JOURNAL RECORD

'Firestone Crisis' Sounds Alarm at Council Meeting

Article excerpt

"Firestone crisis" sounded an alarm at the Oklahoma City Council meeting Tuesday.

"This is an emergency," said Ward 3 Councilman Jack Cornett. "This is an important issue. It absolutely sends a message out to the world when we torpedo something like this."

The issue involves requirements for a franchise to deliver natural gas.

Firestone plant manager Barry Kadechuck wrote city council members and a state official Friday encouraging support to begin operations at the adjacent Smith Cogeneration Inc. plant.

Energy savings of an estimated $2 million by using steam produced at the cogeneration plant was a major factor in Firestone's decision in 1987 not to close the Oklahoma City tire plant, Kadechuck said.

"Failure to support the project at this critical phase would not send the right message," Kadechuck wrote.

Oklahoma Natural Gas Co., a subsidiary of ONEOK Inc. of Tulsa, was successful in state court in protesting operation of a natural gas pipeline to the cogeneration plant without a franchise. Therefore, the power plant did not begin production in early June as planned. Kadechuck said Firestone expects to get steam from the cogeneration plant this summer.

Owner of the $1.5 million pipeline is Williams Natural Gas Co., a subsidiary of The Williams Companies Inc. of Tulsa. Smith Cogeneration purchased the Oklahoma-produced gas from Ladd Petroleum Corp.

American Airlines, another concerned party as to the effect of the franchise ruling upon economic development in Oklahoma, has written a state official about the matter. The airline announced June 7 it will locate a new maintenance facility in Fort Worth rather than Oklahoma City. While other issues ultimately held more weight in the decision to locate in Texas, American officials have said the franchise question was scrutinized while considering Oklahoma City as a location for the new plant.

"Restrictions to accessing the most efficient natural gas transportation simply do not allow Oklahoma's abundant natural gas resources to be delivered at the best price," wrote American managing director L.J. "Larry" Pool.

Oklahoma City needs to project a pro-business attitude, said Cornett.

Vernon Jones, president of The Williams Companies, said Tuesday that the American and Firestone letters clearly indicate the significance of the franchise ruling to existing and potential industry in Oklahoma.

"It's an important issue to this state's ability to attract industry," Jones said.

As a former energy-intensive industry executive, Jones said energy costs are a vital consideration of a company's location. …

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