[Federal Register Volume 63, Number 178 (Tuesday, September 15, 1998)]
[Pages 49349-49350]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-24676]



Federal Energy Regulatory Commission
[Docket No. OR98-24-000]

Tesoro Alaska Petroleum Company v. Amerada Hess Pipeline 
Corporation, ARCO Transportation Alaska, Inc., BP Pipelines (Alaska) 
Inc., Exxon Pipeline Company, Mobil Alaska Pipeline Company, Phillips 
Alaska Pipeline Corporation, and Unocal Pipeline Company; Notice of 

September 9, 1998.
    Take notice that on August 20, 1998, pursuant to sections 1(5), 
3(1), 9, 13(1) and 15(1) of the Interstate Commerce Act (ICA), 49 
U.S.C. App. Secs. 1(5), 3(1), 9, 13(1) and 15(1), Sections 42.06.370, 
42.06.380, and 42.06.410 of the Alaska Pipeline Act the regulations of 
the Commission under 18 CFR part 343, and the regulations of the Alaska 
Public Utilities Commission (APUC), 3 AAC Secs. 48.100, 48.130, Tesoro 
Alaska Petroleum Company (Tesoro) tendered for filing a complaint and 
request for investigation concerning the current Trans Alaska Pipeline 
System (TAPS) Quality Bank methodology and, in particular, the 
lawfulness of the values prescribed for naphtha and vacuum gas oil 
under such methodology.
    Tesoro requests initiation of formal proceedings, including 
concurrent trail type hearings before the FERC and APUC, to investigate 
the lawfulness of the values assigned to the naphtha and VGO cuts under 
the current methodology.
    Tesoro states that it is a shipper on TAPS and owns and operates a 
refinery in Kenai, Alaska. Tesoro competes with other TAPS shippers, 
particularly MAPCO and Petro Star, in the marketing and sale of refined 
products within Alaska and elsewhere. To the extent, therefore, the 
Quality Bank payments for the refinery return streams and other

[[Page 49350]]

heavy streams are artificially suppressed, Tesoro asserts that MAPCO, 
Petro Star and other shippers are subsidized and Tesoro is 
competitively disadvantaged. For these reasons, Tesoro states that it 
has since 1988 actively participated in the Quality Bank proceedings, 
including those in Docket No. OR96-14, to ensure that the various TAPS 
streams, including the refinery return streams, are accurately valued. 
On May 29, 1998, the presiding judge issued an initial decision in 
Docket No. OR96-14 (83 FERC para. 63,011) dismissing the Exxon Company, 
U.S.A. complaint at issue there, and held that Tesoro's issues were 
thereby rendered moot, but that Tesoro was free to file its own 
    Based upon the testimony and exhibits of Tesoro's witness in Docket 
No. OR96-14, Tesoro now seeks to modify the valuation procedure for 
naphtha by: (i) eliminating single market pricing in favor of using 
both West Coast prices; (ii) valuing West Coast naphtha as a function 
of the price of gasoline on the West Coast in recognition of the 
primary use of naphtha on the West Coast; and (iii) adjusting the 
values of the naphtha cuts of the various TAPS streams to account for 
differences in N + A content. Tesoro further proposes that the value of 
VGO by market-appropriate and, to that end, requests adoption of the 
OPIS quote for West Coast high-sulfur VGO for West Cost VGO.
    Finally, Tesoro suggests that the Commission reinstate the 
procedural schedule in Docket No. OR96-14, as such schedule existed 
when the presiding judge terminated that proceeding and invited Tesoro 
to file its own compliant. Tesoro states that the answering evidence 
filed in Docket No. OR96-14 could be incorporated as part of the record 
in this complaint proceeding, and a new date set for the filing of 
rebuttal evidence, with a hearing date no later than 45 days 
thereafter. Tesoro asserts this avoids having to start from ``square 
    Any person desiring to be heard or to protest said complaint should 
file a motion to intervene or a protest with the Federal Energy 
Regulatory Commission, 888 First Street, N.W., Washington, D.C. 20426, 
in accordance with Rules 214 and 211 of the Commission's Rules of 
Practice and Procedure 18 CFR 385.214, 385.211. All such motions or 
protests should be filed on or before September 21, 1998. Protests will 
be considered by the Commission in determining the appropriate action 
to be taken, but will not serve to make protestants parties to the 
proceeding. Any person wishing to become a party must file a motion to 
intervene. Copies of this filing are on file with the Commission and 
are available for public inspection. Answers to this complaint shall be 
due on or before September 21, 1998.
David P. Boergers,
[FR Doc. 98-24676 Filed 9-14-98; 8:45 am]