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Enron Mail |
Mark,
Rate case settlements reached between a pipeline, its customers and Commiss= ion Staff sometime prescribes the treatment of gains on the sale of assets = and specifically the sale of base gas volumes (eg Columbia, CNG settlements= ). In review of the past two rate case settlements of Williston Basin (WBI= ) I found no such provisions. In its current rate case proceeding before F= ERC a limited settlement was reached which dealt primarily with net plant a= nd labor costs. A hearing was held on all remaining issues and is currentl= y in the briefing stage. Neither in the limited settlement, nor in the hea= ring was disposition of base gas revenues addressed. However, the reorganizational settlement that conveyed facilities from MDU = to WBI may be a factor. As a result of restructuring under 636 WBI was obl= igated to sell certain excess volumes of company owned working gas (priced = at $.47 /mcf) to its customers. WBI proposed to sell the gas at market and= retain any profits. As mentioned in the LeBeoeuf, Lamb memo the Commissio= n addressed this issues several times, reversing itself in the process, and= finally ordered that WBI must sell the working gas at cost. Though not re= lying entirely on the reorganizational settlement, throughout the various o= rders, the Commission referenced the 1985 reorganizational settlement as re= quiring any gains on the sale of working gas to be flowed through to WBI cu= stomers. WBI sought rehearing, arguing that the Commission was taking a ve= ry broad interpretation of the settlement. The Commission raised the issue= again in its order on rehearing, among other things, and WBI didn't seek r= ehearing or pursue that particular argument further, which the Commission p= oints out in its final order. As LeBeoeuf Lamb asserts, the environment (Order 636 restructuring) in whic= h the Commission ordered flow-through of profits on the sale of storage vol= umes has changed and those arguments may not be applicable anymore. But, t= he reorganizational settlement might be something to take into account and = should be discussed with WBI. Just something to be aware of. If you have any questions please call. Robert -----Original Message----- From: =09Whitt, Mark =20 Sent:=09Tuesday, September 25, 2001 5:17 PM To:=09Neustaedter, Robert Cc:=09Tycholiz, Barry; Harrison, Tyrell Subject:=09WBI Rate Base Study Just wanted to check in and see if you were able to learn anything useful b= y looking through the WBI rate cases? I will be out the next couple of days so if you email me please cc Barry Ty= choliz and Tyrell Harrison. Thanks Mark
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