HCR 8: Encouraging the Regulatory Commission of Alaska expeditiously to complete its investigation of the Cook Inlet Gas Gathering System.
00 HOUSE CONCURRENT RESOLUTION NO. 8 01 Encouraging the Regulatory Commission of Alaska expeditiously to complete its 02 investigation of the Cook Inlet Gas Gathering System. 03 BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 WHEREAS, in October 2004, the Regulatory Commission of Alaska received a 05 complaint filed by Agrium U.S., Inc., a major buyer and consumer of natural gas and a 06 producer and distributor of fertilizer and other agricultural products and services, against 07 Marathon Oil Company and Union Oil Company of California (Unocal) for operating for 08 more than 30 years the Cook Inlet Gas Gathering System (CIGGS) in violation of the Alaska 09 Public Utilities Regulatory Act and the state's Pipeline Act; and 10 WHEREAS the Agrium complaint alleges three bases under which the commission 11 should exercise jurisdiction to regulate CIGGS: (1) as a public utility under the Alaska Public 12 Utilities Regulatory Act, (2) as a natural gas pipeline, as defined in AS 42.06.630(10), and (3) 13 as a pipeline operating for hire and as a common carrier, as defined in AS 42.06.630(16); and 14 WHEREAS the Agrium complaint was supported by two affidavits, one of which 15 appends a gas exchange agreement and a Unocal invoice for exchange fees; and 16 WHEREAS Marathon and Unocal have answered the complaint by asserting that
01 none of the bases identified by Agrium in the complaint is a valid basis under which the 02 commission must regulate CIGGS; and 03 WHEREAS, in December 2004, the commission determined that the Agrium 04 complaint "has shown good cause to our satisfaction," in that the complaint posits several 05 plausible bases and, for each basis, has alleged facts which, if proven, would mandate that the 06 commission regulate the Cook Inlet Gas Gathering System or exempt it from regulation; and 07 WHEREAS the commission found that Agrium has met the regulatory requirement 08 in that the complainant had presented a sufficient quantum of evidence to support a finding 09 that "probable cause" exists to investigate this matter further, and, for the purpose of opening 10 an investigation only, the commission further found that Agrium has presented sufficient 11 evidence to conclude that the CIGGS pipelines may be transporting natural gas for persons 12 other than CIGGS' owners for a fee, that CIGGS may be a gas transmission public utility, and 13 that it may be a natural gas pipeline, as defined in AS 42.06; and 14 WHEREAS the complaint is against two companies that operate a particular set of 15 pipelines that are located wholly within the state and that transport gas exclusively in 16 intrastate commerce; and 17 WHEREAS the Regulatory Commission of Alaska regulates intrastate pipelines 18 transporting gas under two separate chapters, AS 42.05, the Alaska Public Utilities Regulatory 19 Act, and AS 42.06, the Pipeline Act; and 20 WHEREAS the complainant asks the commission to determine that this particular set 21 of pipelines falls under AS 42.05 or AS 42.06, or both; and 22 WHEREAS none of the parties has contested the commission's jurisdiction to make 23 that determination, and the commission has affirmed that it has jurisdiction to determine 24 whether CIGGS falls within its regulatory purview; 25 BE IT RESOLVED that the Alaska State Legislature encourages the Regulatory 26 Commission of Alaska expeditiously to complete its investigation of the Cook Inlet Gas 27 Gathering System so that Cook Inlet gas exploration initiatives may proceed with greater 28 certainty as to whether critical Cook Inlet natural gas transportation services are subject to 29 commission oversight as regulated services. 30 A COPY of this resolution shall be sent to Kate Giard, Chair of the Regulatory 31 Commission of Alaska.