Opinion ID: 2509156
Heading Depth: 1
Heading Rank: 43

Heading: Allocation of the Western fee

Text: 150. Of the total fees paid to Western of $.434/MCF, the auditors allowed a total deduction of $.224/MCF. This allowance was comprised of $.14/MCF for pipeline fees between Western's facilities and Glenrock, plus $.084/MCF of the $.294/MCF of fees attributed to Western's services. The $.084/MCF was an estimate of costs from the outlet of the glycol dehydrator to the inlet of the MIGC or Fort Union pipeline. Storts correctly surmised that auditors disallowed $.21/MCF based on a relation to Western's rebate of $.21/MMBTU against the MIGC tariff, in effect giving Barrett something like a double allowance. 151. At the same time, Williams provided no evidence of what a reasonable allocation of the Western fees should be. To the contrary, Williams consciously avoided an enquiry to Western that might have yielded a more accurate basis for an allocation. Findings of Fact, ถ43. 152. The Board has accepted the Department's selection of a point of valuation, and therefore must decide the dispute between the parties concerning the deductions which result from the point of valuation. Williams did nothing to support an allocation of the fee for Western's services. On review of the evidence presented at the hearing, we conclude that there is no further information available to the Department that would enable the Department to prepare a better estimate of the allocation of Western costs even if we were to contemplate remanding the case to the Department for more thorough review. The auditors rejected the alternative of denying any allowance, and we cannot conclude that the denial of any allowance would have been more reasonable. 153. With its allocation, the Department has determined that approximately 70% of the fees charged by Western are associated with services between the custody transfer meter and the outlet of the glycol dehydrator. Storts did nothing to demonstrate that this allocation was unreasonable or incorrect, other than question the logic of the Department's estimate. Under the circumstances of this case, we conclude that Williams failed to carry the burden of showing that the Department determination is incorrect. The burden of proof remained with Williams. 154. In our Findings of Fact, we determined that the auditors reached an allowance of $.084/MCF of the Western fees based on two premises. We conclude that this matter should be decided as the Department has done. First, some amount of allowance was fair. Second, the costs, including fuel costs, associated with Western services from the custody transfer meter to the outlet of the glycol dehydrator were greater than the corresponding costs from the outlet of the glycol dehydrator to the inlets of the Fort Union and MIGC pipelines. Findings of Fact, ถ43. We note that the auditors had toured representative field facilities. Findings of Fact, ถถ21-23. We conclude that the judgment of the auditors was supported by first-hand field knowledge in the form of the site visit granted by Barrett under the guidance of Nathan Lopez, Barrett's operations supervisor. We conclude that the auditors made a reasonable estimate based on the best information available. 155. We have concluded that the Department had some reasoned basis for the transportation allowance of $.084/MCF, and that Williams offered no evidence of what such an allowance should be. We therefore conclude that Williams has failed to carry the ultimate burden of persuasion by a preponderance of the evidence.