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Texas Gas Transmission Tops Mastio Customer Satisfaction Survey

Posted on: Saturday, 1 October 2005, 03:01 CDT

By Share, Jeff

Serving customers in nine states from Texas to Ohio, Texas Gas Transmission is a prime example of a mid-sized pipeline company that is flexible enough to adapt to changing market conditions in an industry that prizes reliability and integrity above all else.

That's why the Owensboro, KY-based company took first place honors in the Mastio & Co. 2005 Customer Satisfaction Survey for both Mega and Major Pipeline indexes. Sabine Pipe Line Co., a unit of ChevronTexaco, placed first in both the Regional Pipeline Index and the Interstate Pipeline indexes.

Texas Gas is owned by the Loews Corporation holding company as part of its Boardwalk Pipelines, LLC. In addition to Texas Gas, Boardwalk is comprised of Gulf South Pipeline Company, LP. Texas Gas Transmission was formerly owned by Williams and was sold - albeit with great reluctance - in 2003 to help Williams avoid bankruptcy.

Kathy Kirk

The company may have a new owner, but that doesn't affect the way that its staff deals with customers, said Kathy Kirk, the vice president of commercial services for Texas Gas. Her team follows a very basic strategy: talking and listening - a communications device that seems to be in vogue again in the pipeline business.

"Our strategy has always been to try to work with our customers and satisfy their market needs at competitive prices. It's really nothing exotic or unique," she told P&GJ in an interview.

Kirk said customers apparently like several aspects of Texas Gas' business practices. "I hope they like our willingness to work with them and provide them with the stability they need. Hopefully they will say our honesty and our communications with them on a regular basis are helpful. We're certainly not perfect, but we do strive to make sure that we stay in touch with our customers about what's going on."

In addition to e-mail letters, Kirk said her staff frequently telephone their customers as well as scheduling visits for face-to- face meetings. None of that pesky voice mail, unless it's necessary. Texas Gas also publishes a quarterly newsletter titled "The Customer Connection." What it boils down to is that while price is very important to customers, service reliability is the customers' leading concern, she said. That came from an independent research study that Texas Gas hired to interview 88 executives, mid managers and front-line employees from 65 LDCs, marketers and end-users that utilize its services.

Kirk said one advantage for Texas Gas is that most of its customer-service representatives - whether it be in gas accounting, scheduling, or contracting - are veterans of 10-20 years with the company. Being located in a small city like Owensboro means there is a high likelihood that the utility's turnover will not be an issue. That experience gives them an inherent sense on when to call on customers. It's a factor not to be overlooked in today's competitive marketplace, especially when management counts on them to literally be their eyes and ears on customers' needs.

"With those years of experience and the long-term relationships they have with our customers, our reps really have developed the ability to anticipate their needs and when you need to touch base with them - the whole aspect of customer service," Kirk said.

Though the industry has gone through an upheaval in the past five years, including her own former company, Kirk believes that the business itself has stayed much the same, except that it is much more competitive.

"I really don't think it's changed dramatically even from the time when I first started in the commercial aspect of Texas Gas in 1984, even in the past five or ten years. The FERC encourages competition among pipeline companies and it really has become a very competitive market. Years ago it was nothing for customers to have a long-term - 10- or 15-year contract - with their pipeline suppliers. That's more the exception than the rule because now they tend to contract for the shortest periods of time," she said.

There has been a significant change among those that actually hold the capacity on pipelines. Historically, Kirk said, the parties that had almost all of the contracts with Texas Gas were the traditional distribution companies and municipalities.

"Now we see more marketing companies step up and hold capacity rather than LDCs because they (LDCs) just contract with the marketing companies for their capacity needs," she said, adding that customers are much more experienced in terms of gas purchasing. They've had plenty of time to learn how to buy gas since FERC Order 636 took effect in 1993 and effectively turned the natural gas transmission companies into transporters and storage companies.

Marketing companies often value services differently, depending on how they plan to use those services, than the way the traditional LDC customer might have done, Kirk said. That's one of the reasons the pipeline business is more competitive and challenging today.

"When an LDC is looking at contracting for capacity, probably the utmost issue on their mind is how to meet the city gate needs of their residential, commercial and industrial end users - making sure they have the necessary capacity to meet their peak-day needs. That's their primary need - being there for their customers when it's really cold. I'm not saying the marketers don't look at that because they do, but they are also looking at those days when the LDC may not need all the capacity so what other customer can they serve using that same capacity on any particular day?" she said.

What changes has Kirk, an employee of Texas Gas since 1984, noticed since the Loews purchase?

"Management of the pipeline company is really able to handle the business, not only on a day to day basis, but long-term strategy wise and make those decisions in Owensboro. Loews has been a wonderful parent company to Texas Gas. They support us in wanting us to grow our system as far as attaching new supplies for our customers and the importance of that. With some of the financial challenges that Williams was experiencing, we weren't really able to get the money necessary to do that," she said.

The acquisition has also been positive from a staff perspective.

"From the employee attitude, there were so many different initiatives that were under way when we were part of the Williams Companies. Because they had several pipelines and they naturally looked at a lot of initiatives and common systems employees had to be focused on that so much of the time that it was hard for them to focus on their day-to-day job in working directly with the customers. Now we've kind of gone back to basics where the customers really are our top priority, but that's always been the Texas Gas way, even with the people who were here, 20, 30 or 40 years ago," she said.

The Mastio customer satisfaction study covers 39 interstate, seven intrastate and seven Canadian pipelines that transport approximately 85% of the gas in North America. Mastio segments the pipelines into six different indexes: Mega, Major, Regional, Interstate, Intrastate and Canadian.

The companies experiencing the greatest increase in score from the previous edition were Sabine Pipeline, Northern Natural Gas and Centerpoint Energy Gas Transmission. The rankings using the Mastio Customer Satisfaction Index where price is equally weighted with all of the other customer satisfaction attributes are as follows:

Mega Pipelines

Rank Pipeline

1 Texas Gas Transmission

2 Southern Natural Gas Co.

3 Williams Gas Pipeline-Northwest

4 Natural Gas Pipeline Co. of America

5 Tennessee Gas Pipeline Co.

6 TransCanada Pipelines - Mainline Sys.

7 Williams Gas Pipeline-Transco

8 Panhandle Eastern Pipe Line Co.

9 Dominion Transmission, Inc.

10 Texas Eastern Transmission Corp.

11 Northern Natural Gas Co.

12 ANR Pipeline Co.

13 El Paso Natural Gas Co.

14 Gulf South Pipeline Co.

15 Columbia Gas Transmission Corp.

16 Kinder Morgan Interstate Gas Trans.

Major Pipelines

(pipelines with at least 3,500 miles of pipe and serves three or more states)

The top three of 23 were:

* Texas Gas Transmission

* Centerpoint Energy Gas Transmission

* Southern Natural Gas Co.

The bottom two companies were:

* Florida Gas Transmission

* Kinder Morgan Interstate Gas Transmission

Interstate Pipelines

Rank Pipeline

(pipelines with at least 3,500 miles of pipe and deliveries of at least 1 Tcf)

1 Sabine Pipe Line Co.

2 Great Lakes Gas Transmission

3 CenterPoint Energy-MRT

4 Texas Gas Transmission

5 Transwestern Pipeline Co.

6 Iroquois Gas Trans. System

7 CenterPoint Energy Gas Transmission Co.

8 Southern Natural Gas Co.

9 Williams Gas Pipeline-Northwest

10 Northern Border Pipeline Co.

11 Viking Gas Transmission Co.

12 Wyoming Interstate Co. Ltd.

13 Vector Pipeline

14 Natural Gas Pipeline Co. of America

15 Tennessee Gas Pipeline Co.

16 Trunkline Gas Co.

17 Kern River Gas Transmission

18 Trailblazer Pipeline Co.

19 Williams Gas Pipeline-Transco

20 Colorado Interstate Gas Co.

21 Southern Star Central

22 Panhandle Eastern Pipe Line

23 Gas Transmission Northwest

24 Questar Pipeline Co.

25 Domini\on Transmission, Inc.

26 East Tennessee Natural Gas

27 National Fuel Gas Supply

28 Texas Eastern Transmission

29 Columbia Gulf Transmission

30 Northern Natural Gas Co.

31 Midwestern Gas Transmission

32 ANR Pipeline Co.

33 Algonquin Gas Transmission

34 El Paso Natural Gas Co.

35 Gulf South Pipeline Co.

36 Columbia Gas Transmission

37 Florida Gas Transmission Co.

38 Williston Basin Interstate Pipeline Co.

39 Kinder Morgan Interstate Gas Trans.

Regional Pipelines

(pipelines with at less than 3,500 miles of pipe and serves less than three states)

The top three of 30 were:

* Sabine Pipeline

* Oneok Gas Transportation

* Great Lakes Gas Transmission

The bottom two companies were:

* GulfTerra Texas Pipeline

* BC Pipeline

Intrastate Pipelines

The top three of seven were:

* Kinder Morgan Texas Pipeline

* Oneok Gas Transportation Company

* Enogex, Inc.

The bottom two companies were:

* Atmos Pipeline-Texas

* GulfTerra Texas Pipeline

Canadian Pipelines

The top three of 10 were:

* Transgas Ltd.

* Union Gas Ltd.

* TransCanada Pipelines - Alberta System

The bottom two companies were:

* TransCanada Pipelines - B.C. System

* BC Pipeline.

By Jeff Share/Editor

Copyright Oildom Publishing Company of Texas, Inc. Sep 2005

Source: Pipeline & Gas Journal

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