[Federal Register Volume 64, Number 74 (Monday, April 19, 1999)]
[Notices]
[Page 19141]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-9680]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
[Docket Nos. SA99-22-000, SA99-23-000, and SA99-24-000 (Not
Consolidated)]
Atlantic Richfield Corporation; Notice of Petitions for Dispute
Resolution or, Alternatively, for Adjustment
April 13, 1999.
Take notice that on March 9, 1999, Atlantic Richfield Corporation
(Arco) filed the above-referenced petitions, requesting the Commission
to resolve disputes concerning its Kansas ad valorem tax refund
obligation to the pipelines listed below.
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Pipeline and docket No. Refund claim
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Colorado Interstate Gas Company, SA99-22-000 \1\........ $415,240.17
Northern Natural Gas Company, SA99-23-000 \2\........... 166,103.28
Williams Gas Pipelines Central, Inc., SA99-24-000\3\.... 172,916.89
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\1\ Changed from Docket No. GP99-7-000.
\2\ Changed from Docket No. GP99-8-000.
\3\ Changed from Docket No. GP99-9-000.
Arco requests that the Commission resolve its dispute with Northern
and Williams by holding that termination agreements and/or settlements
with these two pipelines resolved all issues associated with Kansas ad
valorem tax refund liability and extinguishes the pipeline's refund
claim in its entirety. Arco contends that by agreeing in the settlement
to forego claims it for nonperformance it otherwise could have
continued to pursue, Arco agreed to accept total payments under the
contracts that did not exceed the MLP ceilings multiplied by the total
volumes represented by each pipeline's nonperformance. In such
circumstances, no refund should be required. To order otherwise would
prevent Arco from receiving the very benefits it bargained for in the
settlements-settlements that the Commission itself strongly encouraged
as a means to resolve the massive take-or-pay and underpayments
liabilities of interstate pipelines and make the transition to a more
market-responsive and competitive environment.
Arco maintains that Northern and consumers benefited from
agreements and settlements because the settlements allowed the
pipelines to avoid the much higher costs that full-performance of the
contract would have entailed. By resolving ``all claims'' relating to,
inter alia, ``contractual price'', the settlements resolved the Kansas
ad valorem tax reimbursement issue. The Commission has found that these
settlements served the public interest.
Arco also requests the Commission to establish procedure to verify
the refund calculations in all three dockets to ensure fairness and
equity. Alternatively, Arco requests that the Commission waive Arco's
refund liability pursuant to Section 502(c) of the NGPA. Arco asserts
that the Commission has equitable discretion to grant adjustment relief
from this refund requirement. Since the tax reimbursement payments made
by the pipelines were for taxes that Arco in fact paid the State of
Kansas, Arco maintains it did not retain any revenues in excess of the
MPLs. Arco maintains that the equities in the case require the
Commission to waive Arco's refund obligation. At a minimum, Arco
continues, the Commission should waive the royalty portion of the
refund. Arco notes that it sold its Kansas properties in 1993, and thus
no longer has ongoing contractual relationships with its former Kansas
royalty owners. The response from Arco's former royalty owners to
Arco's mailing has been negligible. To engage in extensive searches or
to pursue legal action against these interests would be a cost-
prohibitive exercise in futility. Since Arco has transferred or
otherwise ended the leases in question here, and thus has no ongoing
relationship with the royalty owners, let alone relationships that
would permit Arco to impose a unilateral reduction in future royalty
payments as contemplated in Wylee. Arco asserts that the royalty
portion of the refund claim is uncollectible, as a practical matter,
due to the passage of time and the Kansas statute of limitations.
Arco's petitions are on file with the Commission, and they are open to
public inspection. This filing may be viewed on the web at http://
www.ferc.fed.us/online/rims.htm (call 202-208-2222 for assistance).
Any person desiring to be heard or to make any protest with
reference to any of these petitions should on or before 15 days after
the date of publication in the Federal Register of this notice, file
with the Federal Energy Regulatory Commission, 888 First Street, N.E.,
Washington, D.C. 20426, a motion to intervene or a protest in
accordance with the requirements of the Commission's Rules of Practice
and Procedure (18 CFR 385.214, 385.211, 385.1105, and 385.1106). All
protests filed with the Commission will be considered by it in
determining the appropriate action to be taken but will not serve to
make the protestants parties to proceeding. Any person wishing to
become a party to a proceeding or to participate as a party in any
hearing therein must file a motion to intervene in accordance with the
Commission's Rules.
Linwood A. Watson, Jr.,
Acting Secretary.
[FR Doc. 99-9680 Filed 4-16-99; 8:45 am]
BILLING CODE 6717-01-M