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RCA OKs Thomson pipeline settlement Commission accepts PTE agreement, requires filings, payment of refunds for difference in temporary, agreed rates, within 30 days KRISTEN NELSON Petroleum News
The Regulatory Commission of Alaska has accepted a settlement agreement reached by PTE Pipeline, the state of Alaska and ConocoPhillips Alaska on initial tariff rates for transportation of condensate from Point Thomson to Badami.
The order, dated Oct. 17, accepts the settlement agreement and joint statement filed by PTE Pipeline, the state of Alaska and ConocoPhillips Alaska on Sept. 16.
In the agreement (see story in Oct. 2 issue of Petroleum News), filed with both RCA and the Federal Energy Regulatory Commission, the parties said they had resolved all issues in both dockets and provided stipulated tariff rates for two initial periods of transportation.
PTE Pipeline LLC - owned 68 percent by ExxonMobil Pipeline Co. and 32 percent by BP Transportation (Alaska) Inc. - submitted proposed initial rates of $20.39 per barrel in September of 2015. The state protested and filed a petition to intervene; ConocoPhillips filed to intervene.
RCA established a temporary rate of $20.39 and suspended proceedings for settlement talks among the parties.
All issues settled RCA said the parties stated that the settlement agreement resolved all issued in the proceeding. All parties interested in the rates on the Point Thomson Export Pipeline had opportunity to file comments or intervene, the commission said.
The state has an interest as a royalty interest owner and ConocoPhillips is a working interest owner at the Point Thomson unit: “both interests are diverse from those of PTEP LLC,” RCA said.
The state and ConocoPhillips are parties to the settlement and with the pipeline now transporting condensates from Point Thomson, “an early resolution of this proceeding would clarify the obligations of all parties,” the commission said.
Based on a review of the settlement, RCA said it finds “that the public interest does not require further proceedings in this docket,” and accepts the settlement, “subject to the express condition that no issue should be considered to have been finally determined or adjudicated by virtue of our acceptance” of the settlement.
Refunds due The settlement provides for a rate of $17.56 per barrel beginning April 1, 2016, and ending March 31, 2017, and a rate of $12.09 per barrel beginning April 1, 2017, and ending when the pipeline places “superseding rates in effect, but not later than July 1, 2019.”
RCA said the settlement requires PTEP to refund the difference between the proposed rate and the settlement rate plus interest at 10.5 percent to shippers within 30 days of the commission’s acceptance of the agreement. The agreement also requires a report to the commission from PTEP on the refunds within 30 days of refund payments, by Dec. 16.
The Point Thomson Export Pipeline began moving condensate April 2. As of the end of August Alaska Oil and Gas Conservation Commission data shows the pipeline had moved 147,688 barrels, an average of 1,230 barrels per day in August.
Condensate production from Point Thomson is targeted at 10,000 bpd; the pipeline was built to handle 70,000 bpd.
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