Court Opinion

ID: 9443762
Source: CourtListenerOpinion
Date Created: 2023-08-03 19:29:57.642598+00
Date Added: 2024-06-11T17:29:35.751020
License: Public Domain

On Petition for Rehearing.
MARIS, Circuit Judge.
The Central West Utility Company, an intervenor in this case, has filed a petition for rehearing which calls for brief discussion. Its principal contention is that the inadequacy of the Liberty lateral to deliver the volume of gas which the Commission’s order would require Panhandle to deliver to Central West and other *683customers served from that lateral is due largely to the fact that Panhandle has allowed the lateral to fall into a condition of decay and disrepair. Central West urges that to the extent that the Commission’s orders here under attack require Panhandle to restore the Liberty lateral to the capacity for which it was originally designed and authorized and which it at one time had they are within the Commission’s authority. With this contention we agree.
When a natural-gas company, after securing the approval of the Commission, has constructed or acquired a pipeline having a definite designed capacity it has an obligation in the public interest to maintain the pipeline in such good order and repair as to be able to continue to deliver the volume of gas for which it was originally designed and approved. And if it develops that the company can in actual operation safely and feasibly deliver a larger volume of gas through the pipeline than it was designed to carry this obligation of maintenance includes the duty to keep the pipeline in condition to deliver this larger volume of gas. If the company fails in its duty of maintenance the Commission under section 7(a) of the Act, IS U.S.C.A. § 717f(a), may, if necessary or desirable in the public interest, direct the company to improve its facilities by their rehabilitation and repair, or even reconstruction, to the extent necessary to restore them to their original designed and approved capacity or former actual capacity, as the case may be. For such action would clearly not involve an enlargement of transportation facilities within the ban of the proviso in section 7(a). And the same may well be true of a direction for the use in operating a pipeline of improved facilities which will increase its carrying capacity, provided a physical enlargement of the pipeline itself is not involved.
We adhere, however, to the view expressed in the opinion of the court heretofore filed that the Commission is prohibited by the proviso in section 7 (a) from directing an improvement of the transportation facilities of a natural gas company which involves the enlargement of those transportation facilities, even, though the purpose is to enable the delivery of more gas in order to eliminate undue discrimination between customers. Whether a given improvement does or does not involve a prohibited enlargement may be a close technical question, however. We agree with the view expressed by our brethren of the Sixth Circuit in Michigan Consol. Gas Co. v. Panhandle Eastern Pipe L. Co., 6 Cir., 1949, 173 F.2d 784, 788, that it is a question which should be passed upon in the first instance by the Commission.
Here the Commission has not passed upon this question, since it took the view that it was empowered by section 5(a) of the Act to order the enlargement of the Liberty lateral by Panhandle regardless of the ban of the proviso in section 7(a), because it thought such action to be necessary to avoid undue discrimination among Panhandle’s customers. Its orders in this regard having now been set aside, the Commission will be free to reconsider, in the light of the opinions of this court, the extent to which it may lawfully require Panhandle to improve, and thereby to increase the present capacity of, the Liberty lateral.
The petition for rehearing will be denied.
McLAUGHLIN, Circuit Judge, adheres to the views expressed in his dissenting opinion heretofore filed.