In a decision issued today the Alaska Supreme Court affirmed a decision of the Alaska Superior Court that in-state shipping rates charged by the owners of the trans-Alaska pipeline were unjust and unreasonable from 1997 through 2000.
The pipeline owners had appealed the Superior Court decision to the Supreme Court which said today that the “arguments on appeal are generally the same as those they presented to the superior court. We conclude that the superior court correctly resolved these arguments and therefore adopt the opinion of the superior court.”
The superior court decision, issued in January 2006, affirmed a 2002 decision of the Regulatory Commission of Alaska.
RCA rejected a rate-setting methodology that the State of Alaska agreed to in a 1985 settlement. RCA said the in-state rates for transportation on the trans-Alaska oil pipeline were not “just and reasonable” under Alaska’s Pipeline Act and imposed its own ratemaking formula based on straight-line depreciation of the pipeline’s assets.
RCA ordered refunds.
Editor’s Note: See story in Feb. 24 issue of Petroleum News, available to subscribers online Friday, Feb. 22.