[Federal Register Volume 62, Number 218 (Wednesday, November 12, 1997)]
[Notices]
[Pages 60708-60709]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-29737]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Office of Hearings and Appeals
Implementation of Special Refund Procedures
AGENCY: Office of Hearings and Appeals, Department of Energy.
ACTION: Notice of implementation of special refund procedures.
-----------------------------------------------------------------------
SUMMARY: The Office of Hearings and Appeals (OHA) of the Department of
Energy announces the procedures for disbursement of $2,451,396 (plus
accrued interest) in alleged or adjudicated crude oil overcharges
obtained by the DOE from Crude Oil Purchasing, Incorporated (Case No.
LEF-0058), Jaguar Petroleum, Incorporated (Case No. LEF-0059), Westport
Energy Corporation/Westport Petroleum Corporation (Case No. LEF-0113),
and Gratex Corporation/Compton Corporation (Case No. VEF-0012). The OHA
has determined that the funds obtained from these firms, plus accrued
interest, will be distributed in accordance with the DOE's Modified
Statement of Restitutionary Policy in Crude Oil Cases, 51 FR 27899
(August 4, 1986).
FOR FURTHER INFORMATION CONTACT:
Bryan F. MacPherson, Assistant Director, Office of Hearings and
Appeals, Washington, DC 20585-0107, (202) 426-1571.
SUPPLEMENTARY INFORMATION: In accordance with 10 CFR 205.282(c), notice
is hereby given of the issuance of the Decision and Order set forth
below. The Decision and Order sets forth procedures that the DOE will
use to distribute a total of $2,451,396, plus accrued interest,
remitted to the DOE by (1) Crude Oil Purchasing, Incorporated, (2)
Jaguar Petroleum, Incorporated, (3) Westport Energy Corporation &
Westport Petroleum Corporation, and (4) Gratex Corporation/Compton
Corporation. The DOE is currently holding these funds in interest
bearing escrow accounts pending distribution.
The OHA will distribute these funds in accordance with the DOE's
Modified Statement of Restitutionary Policy in Crude Oil Cases, 51 FR
27899 (August 4, 1986)(the MSRP). Under the MSRP, crude oil overcharge
moneys are divided among the federal government, the states, and
injured purchasers of refined petroleum products. Refunds to the states
will be distributed in proportion to each state's consumption of
petroleum products during the price control period. Refunds to eligible
purchasers will be based on the volume of petroleum products that they
purchased and the extent to which they can demonstrate injury. Because
the June 30, 1995, deadline for the crude oil refund applications has
passed, no new applications from purchasers of refined petroleum
products will be accepted.
Dated: October 29, 1997.
George B. Breznay,
Director, Office of Hearings and Appeals.
Decision and Order of the Department of Energy
Implementation of Special Refund Procedures
Names of Firms: Crude Oil Purchasing, Incorporation; Jaguar
Petroleum, Incorporated; Westport Energy Corporation & Westport
Petroleum Corporation; Gratex Corporation/Compton Corporation.
Dates of Filings: July 20, 1993; July 20, 1993; September 9, 1993;
March 23, 1995.
Case Numbers: LEF-0058, LEF-0059, LEF-0113, VEF-0012.
The Economic Regulatory Administration (ERA) of the Department of
Energy filed four Petitions for the Implementation of Special Refund
Procedures with the Office of Hearings and Appeals (OHA). In the
petitions, ERA asks OHA to distribute funds remitted to the DOE
pursuant to settlements between Crude Oil Purchasing, Incorporated
(COP), Jaguar Petroleum, Incorporated (Jaguar), Westport Energy
Corporation & Westport Petroleum Corporation (Westport), Gratex
Corporation and its parent, Compton Corporation (Gratex/Compton). A
total of $2,451,396, plus interest, is available for restitution. All
of these funds are now being held in interest-bearing escrow accounts
pending a determination regarding their proper disposition.
In accordance with the procedural regulations codified at 10 C.F.R.
Part 205, Subpart V, the ERA requests in its Petitions that the OHA
establish special refund procedures to remedy the effects of any
regulatory violations which were resolved by these settlements. This
Decision and Order sets forth the OHA's final plan to distribute these
funds.\1\
---------------------------------------------------------------------------
\1\ For a more detailed discussion of Subpart V and the
authority of the OHA to fashion procedures to distribute refunds,
see Petroleum Overcharge Distribution and Restitution Act of 1986,
15 U.S.C. 4501-07, and Office of Enforcement, 9 DOE para.82,508
(1981).
---------------------------------------------------------------------------
I. Background
On September 21, 1982, DOE and COP entered into a Consent Order
which resolved all pending or potential claims that DOE had or may have
[[Page 60709]]
against COP relating to COP's compliance with the federal petroleum
price and allocation regulations during the period from January 1, 1973
to January 27, 1981. There is a total of $93,750, plus interest,
available from COP for restitution.
On May 31, 1983, DOE and Jaguar entered into a Consent Order which
resolved all pending or potential claims that DOE had or may have
against Jaguar relating to Jaguar's compliance with the federal
petroleum price and allocation regulations during the period from
November 14, 1979 to January 27, 1981. There is a total of $64,500,
plus interest, available from Jaguar for restitution.
On May 11, 1983, the EAR issued a Proposed Remedial Order (PRO) to
Westport alleging overcharges in the resale of crude oil during the
period from June 1980 to November 1980. OHA dismissed this PRO after
Westport was discharged in bankruptcy and DOE was entitled to receive
payments under the bankruptcy reorganization plan. Under Westport's
Second Amended Liquidating Plan of Reorganization, approved by the U.S.
Bankruptcy Court for the District of Colorado on July 30, 1986,
Westport was required to make payments to DOE, and OHA was directed to
distribute to the Westport escrow account %35 of any refunds that it
granted to Westport in other refund proceedings. Thus far, DOE has
collected a total of $126,172 from Westport. That amount, plus
interest, is available for restitution.
ERA filed claims in the bankruptcy cases of Gratex and Compton
alleging overcharges in the resale of crude oil during the period from
December 1978 to December 1980. On April 27, 1984, ERA issued a PRO to
Gratex and Compton based on these same facts. On October 18, 1988, the
United States Bankruptcy Court for the Northern District of Texas
approved a Compromise Agreement in the Gratex proceeding which
obligated Gratex to pay DOE a lump sum plus a percentage of future
distributions made to unsecured creditors. In 1992, the United States
Bankruptcy Court for the Northern District of Texas approved a
compromise agreement in the Compton proceeding. Thus far, Gratex and
Compton have paid to the DOE the sum of $2,166,974. This amount, plus
interest, is available for restitution.
II. The Proposed Refund Procedures
On April 22, 1997, we issued a proposed Decision and Order (PDO)
that tentatively concluded that ERA's Petitions for the Implementation
of Special Refund Procedures with respect to the funds collected from
these four firms should be approved. Notice of Proposed Implementation
of Special Refund Procedures, 62 Fed. Reg. 23444 (April 30, 1997). In
each case, we proposed to distribute these funds in accordance with the
DOE's Modified Statement of Restitutionary Policy in Crude Oil Cases,
51 Fed. Reg. 27899 (August 4, 1986) (the MSRP). The MSRP has been the
basis for the distribution in these Subpart V proceedings of all crude
oil funds DOE has obtained. See Order Implementing the MSRP, 51 Fed.
Reg. 29689 (August 20, 1986); Notice regarding the Order Implementing
the MSRP, 52 Fed. Reg. 11737 (April 10, 1987).
The MSRP was issued as a result of a court-approved Settlement
Agreement. In re: The Department of Energy Stripper Well Exemption
Litigation, 653 F. Supp. 108 (D. Kan. 1986) (the Stripper Well
Settlement Agreement). The MSRP establishes that 40 percent of the
crude oil funds will be remitted to the federal government, another 40
percent to the states, and up to 20 percent may be initially reserved
for payment of claims to injured parties. The MSRP also specifies that
any monies remaining after all valid claims by injured purchasers are
paid be disbursed to the federal government and the states in equal
amounts.
OHA did not receive any comments on the PDO, and we adopt its
tentative determination to distribute the funds remitted by COP,
Jaguar, Westport, and Gratex/Compton in accordance with the MSRP.
Accordingly, we will reserve 20 percent of these funds for direct
refunds to claimants.\2\ The remaining 80 percent of the funds
collected from these firms shall be disbursed in equal shares to the
states and the federal government for indirect restitution. Refunds to
the states will be in proportion to the consumption of petroleum
products in each state during the period of price controls, as set
forth in Exhibit H of the Stripper Well Settlement Agreement, 6 Fed.
Energy Guidelines para. 90,509 at 90,687. When disbursed, these funds
will be subject to the same limitations and reporting requirements as
all other crude oil monies received by the states under the Stripper
Well Settlement Agreement. If additional funds are subsequently
collected from these firms after the issuance of this Decision and
Order, such funds shall be distributed in the same manner.
---------------------------------------------------------------------------
\2\ It is no longer possible to file an Application for Refund
from the crude oil funds as the final deadline for such Applications
was June 30, 1995. See 60 FR 19914 (April 21, 1995). A party that
submitted a timely claim in the crude oil refund proceeding need not
file another claim in order to share in the funds at issue in this
Decision. OHA is currently paying crude oil refund claims at the
rate of $0.0016 per gallon. We will decide whether additional
refunds will be made when we are better able to determine how much
additional money will be collected from firms that have either
outstanding obligations to the DOE or enforcement cases currently in
litigation.
---------------------------------------------------------------------------
It Is Therefore Ordered That:
(1) The Director of Special Accounts and Payroll, Office of
Departmental Accounting and Financial Systems Development, Office of
the Controller of the Department of Energy shall take all steps
necessary to transfer the full balances from the following accounts:
approximately $93,750, plus all accrued interest, from the Crude Oil
Purchasing, Incorporated subaccount (Account No. 6A0X00269T),
approximately $64,500 plus all accrued interest from the Jaguar
Petroleum, Incorporated subaccount (Account No. 640X00444T),
approximately $126,172, plus all accrued interest from the Westport
Energy Corporation & Westport Petroleum Corporation subaccount (Account
No. 6C0X00292Z), approximately $2,166,974 plus all accrued interest
from the Gratex Corporation/Compton Corporation subaccount (Account No.
6A0X00340W), for a total of approximately $2,451,396, plus all accrued
interest, pursuant to Paragraphs (2), (3), and (4) of this Decision.
(2) The Director of Special Accounts and Payroll shall transfer
$980,558 (plus interest) of the funds obtained pursuant to Paragraph
(1) above into the subaccount denominated ``Crude Tracking--States,''
Number 999DOE003W.
(3) The Director of Special Accounts and Payroll shall transfer
$980,558 (plus interest) of the funds obtained pursuant to Paragraph
(1) above into the subaccount denominated ``Crude Tracking--Federal,''
Number 999DOE002W.
(4) The Director of Special Accounts and Payroll shall transfer
$490,280 (plus interest) of the funds obtained pursuant to Paragraph
(1) above into the subaccount denominated ``Crude Tracking--Claimants
4,'' Number 999DOE010Z.
(5) This is a final Order of the Department of Energy.
Dated: October 29, 1997.
George B. Breznay,
Director, Office of Hearings and Appeals.
[FR Doc. 97-29737 Filed 11-10-97; 8:45 am]
BILLING CODE 6550-01-M