Opinion ID: 2545224
Heading Depth: 1
Heading Rank: 9

Heading: Duty to Maintain

Text: [¶ 47] Sinclair also contends Amoco had a duty to maintain its facilities as a public utility under both statutory and regulatory authority and PSC failed to make a determination regarding this issue. Moreover, Sinclair contests it was improper for PSC to grant Amoco's abandonment application predicated on Amoco's contention the subject storage tank was in a dilapidated condition. [¶ 48] Initially, this court recognizes that PSC did make a review as to whether there existed a connection between what had previously transpired leading up to the deterioration of the system and the proposed abandonment sought by Amoco. This was expressly detailed by PSC at the hearing. Furthermore, the evidence presented at the hearing showed that the only unusable portion of the facilities was the 55-year-old storage tank. Indeed, at the hearing Citation admitted that it intended to continue to use the facilities with the exception of the storage tank. This fact was expressly detailed by PSC in its order: the gathering lines serving the Little Buffalo Field remain in a sufficiently safe and adequate condition to provide crude oil gathering service. [¶ 49] Upon our review of the record, we must also agree with the conclusions of PSC expressed in its order that: The evidence of record reflects the parties' concurrence that the storage tank needs to be either repaired or replaced. Although the gathering lines and the existing 10,000 barrel storage tank are not cathodically protected and are of similar vintage, the Commission concurs with the opinions expressed by Amoco and Citation that the current condition of the storage tank precludes its continued use. Amoco witness Boslett described the storage tank as having a crumbling foundation, serious corrosion, bowed stop parts, and being in service beyond its useful life. Mr. Boslett further testified that recent cleaning of the tank resulted in leaks. Simply stated, the evidence presented supports the conclusion that the storage tank had reached the end of its useful life. [¶ 50] Sinclair also challenges Amoco's efforts to maintain the storage tank and alludes that Amoco had received PSC approved higher rates in order to better service and maintain its facilities, yet failed to do so in this case. Nevertheless, the evidence presented at the hearing confirmed that Amoco had taken specific maintenance steps with respect to the storage tank over the years and had kept the storage tank in use over a substantial number of years without accident, injury, or spillage. The evidence also supported the fact that Amoco, to its credit, has and abides by an extremely stringent internal policy with respect to leaks and spills. [¶ 51] Sinclair also contends that PSC should have reprimanded Amoco for having shut down the gathering system prior to PSC's determination regarding Amoco's application for abandonment. We hold Sinclair's argument in that regard lacks merit. As related above, on November 16, 2000, prior to hearing, Amoco informed PSC the Little Buffalo Gathering System had been suspended effective October 1, 2000, for reasons of environmental safety because a storage tank within the system was in substantial disrepair. Amoco suspended operation because cleaning the tank resulted in leaks, and Amoco was concerned that continued use of the storage tank might result in spillage. Amoco also confirmed at the hearing that should PSC rule that Amoco's requested abandonment be denied, Amoco was prepared to move forward as directed by PSC and place the storage tank again into service after making the required steps to insure the tank's safety. [¶ 52] Further, common sense dictated the actions of Amoco in taking steps to remove the storage tank from service. Presumably, had Amoco not taken these steps and simply awaited the determination by PSC, which was ultimately rendered many months later, a realized and actual environmental catastrophe may have resulted. Finally, upon its review, PSC certainly has the authority to adequately deal with the actions of Amoco in the event PSC found them to be unsupported and not taken in good faith. See Williston Basin Interstate Pipeline Co. v. Public Serv. Comm'n, 996 P.2d 663, 667 (Wyo.2000). [¶ 53] Finally, Sinclair disputes PSC's refusal to address whether Citation became a public utility when it entered into the settlement agreement with Amoco. Upon our review, we hold that this issue was not properly before PSC, as the only issue to be addressed in this proceeding was Amoco's application for abandonment. Citation's status is clearly distinct and squarely separate in nature. We also further recognize that although the issue of Citation's status as a public utility may certainly be properly brought before PSC, it is most appropriate that this issue be addressed in a separate proceeding so as to allow the full development of the facts and to afford all parties an opportunity for an independent, fair, and equitable hearing concerning this issue. [¶ 54] We also must point out that PSC's refusal to address or render a determination on Citation's status as a public utility did not preclude PSC from making its ultimate decision upon Amoco's abandonment application. As set forth above, we hold that PSC took a very deliberate, conscientious, and systematic approach in its analysis to ensure its determination was appropriately based upon the specific criteria previously enumerated by this court and that PSC's ultimate determination to grant Amoco's application is supported by substantial evidence.