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Title: Contract Interpretation
Author: J. C. Raper
Source: 1984 Gulf Coast Measurement Short Course (Now called ASGMT)
Year Published: 1984
Abstract: The purchase and sale of gas is not simply an exchange of natural gas for money, but is a legal transaction governed by written agreements. These agreements often require negotiations and interpretations. The gas industry began over a hundred years ago when gas was first transported successfully and used effectively for domestic purposes. During the next several decades, no one deliberately searched for gas and even as late as 30 or 40 years ago, contracting for the sale of gas was often a matter of someone having gas to sell finding someone who would simply agree that the gas would be taken at some price, often less than two or three cents per MCF. In more recent years gas sales have been made under verbal agreements, but such sales have usually been short-term transactions that were often confirmed later in writing. Some gas sales are currently made under terms of brief written agreements, sometimes in letter form and not more than two or three pages in length. Gas maintains a completely different position now than in these early days. It is a superior fuel and is in demand. The sale of gas should therefore be made under terns of formal type contracts negotiated between purchasers and sellers wherein all the terms covering conditions known or reasonably anticipated are clearly spelled out. In many instances, differences arise because of unclear wording in the agreements and unforseen circumstances. These differences must be negotiated and interpretation of the contract is necessary.

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