[Federal Register Volume 65, Number 231 (Thursday, November 30, 2000)]
[Notices]
[Pages 71307-71308]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-30487]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket Nos. RP98-39-000 et al.]


Northern Natural Gas Company et al.; Notice of Summary Settlement 
on Kansas Ad Valorem Tax Refund Matters on Northern Natural Gas 
Company's System

November 24, 2000

    In the matter of: GP98-5-000, GP98-8-000, GP98-12-000, GP98-14-
000, GP98-20-000, GP98-22-000, GP98-24-000, GP98-26-000, GP98-30-
000, GP99-15-000, GP99-16-000, GP99-17-000, GP99-18-000, SA98-8-000, 
SA98-10-000, SA98-16-000, SA98-18-000, SA98-20-000, SA98-22-000, 
SA98-32-000,

[[Page 71308]]

SA98-33-000, SA98-35-000, SA98-37-000, SA98-38-000, SA98-40-000, 
SA98-42-000, SA98-48-000, SA98-49-000, SA98-51-000, SA98-53-000, 
SA98-56-000, SA98-60-000, SA98-61-000, SA98-64-000, SA98-65-000, 
SA98-72-000, SA98-76-000, SA98-80-000, SA98-83-000, SA98-91-000, 
SA98-92-000, SA98-93-000, SA98-97-000, SA98-101-000, SA99-4-000, 
SA99-5-000, SA99-6-000, SA99-18-000, SA99-23-000, SA99-26-000; Mobil 
Oil Corporation, OXY USA Inc., Amoco Production Company, Anadarko 
Petroleum Corporation, Union Pacific Resources Company, Kansas 
Natural Gas Inc., Bill C. Romig, ONEOK Resources Company, Barbara J. 
Wilson et al., Burlington Resources Oil & Gas Co., Strohls, Strohls, 
Kansas Independent Oil & Gas Assn., Ensign Oil & Gas Inc., Helmerich 
& Payne, Inc., Midgard Energy Company, Riviera Drilling & 
Exploration Co., Dale Schwarzhoff, Sally L. Bone, Kaiser--Francis 
Oil Company, Pioneer Natural Resources USA, Inc., Lee Banks, d/b/a 
Banks Oil Company, Pickrell Drilling Co., Inc., John W. Lebosquest, 
Hummon Corporation, Leo B. Helzel, Graham-Miochaelis Drilling 
Company, Kansas Petroleum, Inc., Benson Mineral Group, Inc., First 
National Oil Company, Louis & Bruce F. Welner, R. J. Patrick 
Operating Company, Pickrell Drilling Company, Inc., John O. Farmer 
Inc., Edwin A. Cornell, Hummon Corporation, Trees Oil Company, Beren 
Corporation, Broadhurst Operating Limited, Partnership No. 2, 
Broadhurst Operating Limited Partnership No. 3, Ralph Howard, Inc., 
Eastman Dillon Oil & Gas Assoc., IMC Global, Inc., Continental 
Energy, Questa Energy Corp., Argent Energy, Inc., Harken Energy 
Corporation, Chevron U.S.A. Inc., Atlantic Richfield Company, Texaco 
Exploration and Production, Inc.

    Published here is a summary of the settlement filed by Northern on 
November 20, 2000. The settlement addresses Kansas ad valorem tax 
refund matters on Northern's system.
    Pursuant to Rule 602(c)(1)(ii) of the Rules of Practice and 
Procedure of the Federal Energy Regulatory Commission (Commission), 18 
CFR Section 385.602, Northern Natural Gas Company (Northern) hereby 
submits an Explanatory Statement with respect to the Stipulation and 
Agreement of Settlement (hereinafter Settlement). This statement is a 
summary only. The terms of the Settlement are authoritative as to the 
intent and the agreement of the parties.
    This Settlement is intended to facilitate and expedite the 
Commission's implementation of the decision of the United States Court 
of Appeals for the District of Columbia circuit in Public Service 
Company of Colorado v. FERC, involving the refund of Kansas ad valorem 
taxes on Northern's system. In Public Service, the court upheld the 
Commission's decision that producers must refund certain Kansas ad 
valorem tax reimbursements that were collected in excess of the maximum 
lawful prices (MLP) for first sales of natural gas under Title I of the 
Natural Gas Policy Act of 1978. On September 10, 1997, the Commission 
issued an order implementing Public Service. The September 10 order 
established procedures and timetables for producers to make refunds to 
the pipelines, and for the pipelines to flow the refunds through to 
their customers.
    To comply with the September 10 Order, Northern sent Statements of 
Refunds Due to producers in November 1997. Subsequently, Northern 
received additional information affecting the refund liability of 
individual working interest owners. As a result, Northern has made 
various revisions to its original Statements of Refunds Due. many of 
the working interest owners have challenged Northern's Statements of 
Refunds Due in formal filings with the Commission, raising a number of 
issues, including headroom (i.e. whether the price paid by Northern and 
the tax reimbursement, taken together, exceeded the applicable MLP), 
the allocation of refund claims among working interest owners, the 
uncollectability of royalty related refunds, and other objections.
    This Settlement is a reasonable means of helping resolve the 
difficult Kansas ad valorem tax refund matters currently before the 
Commission. This Settlement will eliminate the need for more lengthy 
proceedings, either formal or informal. Approval of this Settlement 
will provide relief to small producers, reduce the administrative 
burdens on the Commission, its Staff, Northern, first sellers and 
numerous interest owners and intervenors, of litigating countless 
proceedings before the Commission that involve many complex issues. All 
parties, as well as the public interest would benefit from the 
termination of numerous petitions for relief under Section 502(c) of 
the NGPA pending before the Commission.
    Exhibit No. 1 contains the Deceased Estates and Bankruptcies. 
Exhibit Nos. 2 and 3 contain lists of large producers and small 
producers, respectively, who have a refund obligation pursuant to the 
settlement and have paid on or before December 1, 2000. Exhibit No. 4 
contains a list of small producers with total refund claims of less 
than $50,000. No further action is required if a Small Producer under 
$50,000 accepts this settlement. Parties may access these exhibits 
through the Commissions's website at www.ferc.fed.us or contact the 
Secretary's Office at 202-208-0400.

Linwood A. Watson, Jr.,
Acting Secretary.
[FR Doc. 00-30487 Filed 11-29-00; 8:45 am]
BILLING CODE 6717-01-M