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Burlington Resources Oil & Gas Co. LP v. Federal Energy Regulatory Commission
Citation: 38 F. App'x 1Docket: Nos. 01-1233, 01-1248, 01-1251, 01-1252, 01-1253
Court: Court of Appeals for the D.C. Circuit; April 2, 2002; Federal Appellate Court
Judgment was issued by the court affirming the Federal Energy Regulatory Commission’s (FERC) orders challenged by Burlington Resources Oil and Gas Company, Amoco Production Company, BP Energy Company, and Conoco, Inc. (collectively "Indicated Shippers"). The Indicated Shippers argued that the FERC's interpretation of the Settlement regarding fuel rates was arbitrary and capricious, specifically referencing Section 15.2, which they claimed locked in fuel rates for the term of the Settlement. However, the court found that the term "settlement rates" did not include fuel rates, as defined in Section 3.2, which delineated specific components that did not encompass fuel rates. Instead, fuel rates are governed by Article 8 of the Settlement, which allows for periodic adjustments. The court concluded that FERC's interpretation was reasonable and did not require consideration of whether modifications should follow § 4 or § 5 of the Natural Gas Act. The court also addressed the validity of FERC's approach to calculating fuel charges, determining that FERC's removal of costs from specific facilities for the entire historical base period was justified, as these costs were not expected to recur. The court affirmed FERC's methodology and decision-making process, including its choice of the date of refunctionalization for fuel cost analysis, rejecting the Indicated Shippers' claims and arguments. This disposition will not be published, and the mandate issuance is delayed pending any timely petitions for rehearing.