|
Unocal, other owners, reach TAPS agreement
Kristen Nelsom Petroleum News
Unocal Pipeline Co. suspended its operations on the Trans Alaska Pipeline System in 2012, requesting authorization from the Regulatory Commission of Alaska temporary suspension of its share of pipeline capacity, “pending the finalization of the sale of its ownership interest.” Unocal had the smallest interest of any of the owners, just 1.36%, the company told RCA, and said its share could be sold or transferred to “a third party, another TAPS Owner, or all of the remaining TAPS owners.”
Since 2012, Unocal has been in discussions with the other owners (BP Pipelines (Alaska) Inc., Exxon Mobil Pipeline Co. and ConocoPhillips Transportation Alaska Inc.)
In September Unocal told RCA that issues around sale of its share of TAPS “have been resolved” and said it was working with other entities on a joint application to the commission on the transfer of its TAPS shares.
That application, dated Oct. 21, is now in the hands of the commission, which said in an Oct. 28 public notice that while it had not assessed completeness of the application or ruled on a motion for waiver, it would rule on the petition for waiver and determine if the application is complete by Dec. 18.
Proportional shares The parties said in the application that agreement was reached for the remaining TAPS carriers to acquire Unocal’s share in a ratio comparable to their existing ownership percentages. In addition to approval of the transfer of operating authority for Unocal’s shares, the application also requests amendment of certificates of public convenience and necessity to reflect the new ownership positions.
In a separate motion the parties requested expedited consideration.
The parties said, “Unocal and the Remaining TAPS Carriers engaged in a protracted dispute concerning matters related to the transfer of Unocal’s interest in TAPS, which involved litigation in the Texas courts.” All of the disputes have recently been settled.
The application does not disclose the nature of those disputes.
The proposal says each of the remaining carriers “will acquire a portion of Unocal’s interest proportionate to its ownership interest in TAPS, with slightly different shares of the Pipeline Assets and Terminal Tankage.”
Unocal’s share of the pipeline is 1.3561%.
BP’s current pipeline ownership is 48.441% and it acquires an additional 0.6659% for a new total of 49.1069%. ConocoPhillips has 29.2086%, acquires an additional 0.4016% for a total of 29.6102%. ExxonMobil has 20.9943% and acquires an additional 0.2886% for a new total of 21.2829%.
Terminal tankage ownership percentages are slightly different: Unocal ownership there was 1.666%.
BP has 47.5881%, acquires 0.8033% for a total of 48.3914%. ConocoPhillips has 28.1267%, acquires an additional 0.4748% for a total of 28.6015%. ExxonMobil has 22.6252%, acquires 0.3819% for a total of 23.0071%.
Other approvals The application says Unocal is also working to obtain approval from the federal Bureau of Land Management to transfer its interest in the federal TAPS right of way grant to the remaining carriers. State approval is not required, the application says, but Unocal has notified the Alaska Department of Natural Resources of the pending transfer.
In a separation motion for expedited consideration the companies request RCA approval of the transfer by Jan. 31, 2020, noting accounting and financial considerations, and the fact that as part of the sale of its Alaska assets to Hilcorp, BP Pipelines (Alaska) Inc. is transferring all of its Alaska-related assets and interests to Harvest Alaska LLC, including its interest in TAPS, and closure of the Unocal transfer “well in advance of the transfer of BPPA’s ownership interest in TAPS as part of the larger BP Exit Transaction will have benefits for all involved parties and will reduce the potential for procedural confusion surrounding how to treat the part of Unocal’s interest that is being transferred to BPPA.”
| 