DC Circuit Affirms FERC’s Broad Discretion to Deal with TAPS Pooling Agreement and Contribution of Both Interstate and Intrastate Shippers

摘要

An opinion (1312-48, 1312-49) of the U.S. Court of Appeals for the D.C. Circuit last month addressed FERC’s regulation of “common carrier” oil pipelines insofar as it interpreted the cost-pooling scheme that applies to both interstate and intrastate users of the Trans Alaska Pipeline System (TAPS). The unanimous decision (2/20/15) of the Court, comprised of Circuit Judges Griffith, Kavanaugh and Wilkins, and written by Judge Wilkins, rejected a challenge led by Tesoro Alaska Co. and Anadarko Petroleum to the authority of FERC to approve a cost pooling agreement (settlement) among the Carriers that allocates most fixed costs on the basis of each Carrier’s share of combined interstate and intrastate utilization of TAPS. According to the panel of judges, FERC did have statutory authority to approve the settlement; did not improperly regulate intrastate commerce; and did comply with Administrative Procedure Act (APA) requirements in reaching its decisions. Tesoro Alaska Co. v FERC (BP Pipelines (Alaska) Inc., et al., DC Circuit, 2/20/15.