C. F. Braun & Co. v. Oklahoma Gas & Electric Co. (603 F.2d 132, 1979)

LEWIS, Circuit Judge.

The dispute giving rise to this appeal centers around a pricing provision in a contract executed by the parties on October 30, 1970. The contract provides that the plaintiff, C. F. Braun & Co., will produce and sell natural gas from its wells to the defendant, Oklahoma Gas & Electric Co. Although the sale of gas from four of the wells covered by the contract is not subject to price regulation by the Federal Power Commission (hereinafter referred to as FPC), article 8.1 of the contract ties an alternative price for gas sold under the contract to the FPC price regulation. The provision reads:

In the event the Federal Power Commission, in the exercise of its authority to regulate the wellhead price of natural gas, shall, at any time during the term hereof, establish an area price (hereinafter referred to as the “area price”) which would be applicable to gas covered by this contract if the same were subject to the authority of said commission which area price is higher than the price provided for by the terms of this contract effective upon the date of said area price, then the price to be paid for gas purchased under this contract thereafter shall be one-half cent (V2