23The comparable uncontrolled price

23 The comparable uncontrolled price

(1) A comparable uncontrolled price, or CUP, in relation to a relevant transaction for a volume or mass of project sales gas, is a price for sales gas: (a) that was obtained for a sale in a market that the Commissioner is satisfied is a relevant market in relation to the transaction; and (b) that the Commissioner is satisfied is an observable arm’s length price. (3) In determining whether a market is relevant, the demand and supply characteristics of the market must be taken into account, including: (a) the composition of sales gas sold in the market; and (b) geographic differences between the production facilities and the product delivery point of the sales gas sold in the market; and (c) the end use for the sales gas sold in the market.

Note: Example: Retail, wholesale, manufacturing, feedstock, domestic.

(4) In determining whether a market is relevant, the following factors must also be taken into account: (a) the terms of contracts usual in the market, including volumes, discounts, exchange exposures and other relevant conditions that would reasonably be considered to affect the price; (b) market strategies; (c) the existence of spot sales (including market penetration sales) below or above marginal cost; (d) processing costs; (e) technology used in processing; (f) any other factors that it would be reasonable to consider. (5) In this section:

relevant transaction, for a volume or mass of project sales gas, means:

(a) a sale of the gas to which paragraph 24(1)(d) of the Act applies; or
(b) an act by which the gas becomes an excluded commodity to which paragraph 24(1)(e) of the Act applies.