|
Unocal asks state for TAPS rate increase Request comes as RCA, FERC hammer out details of 12 previous rate cases; other pipelines asking for rate changes up and down Eric Lidji For Petroleum News
Union Oil Co. of California has asked state regulators for a 7 percent increase to the rate it charges to ship oil on the trans-Alaska oil pipeline to in-state destinations.
Unocal is proposing to charge $3.31 to ship a barrel of oil from the North Slope to North Pole and about $5.18 to ship to Valdez, depending on the final destination. (There are two off-take points in Valdez: the PetroStar refinery and the Valdez Marine Terminal.)
Under temporary rates approved earlier this year, Unocal currently charges $3.07 per barrel to ship to North Pole, and about $4.83 per barrel to ship to points in Valdez.
The company said the increase is needed because throughput is declining while operating costs are increasing. The proposed rates would bring Unocal about $14.7 million per year, compared to the $13.7 million the company currently earns on in-state markets.
Unocal wants the rates to go into effect on Jan. 1, 2012.
Ownership of the pipeline is divided among subsidiaries of BP, ConocoPhillips, ExxonMobil, Koch and Unocal. Unocal owns the smallest stake at 1.36 percent.
Increasing complexity The Regulatory Commission of Alaska is now considering 13 interconnected tariff cases.
Because many of the points of debate on the state level mirror details relevant to the interstate commerce aspects of the pipeline, the RCA and the Federal Energy Regulatory Commission are in the middle of a months-long hearing process concerning those issues.
The hearings primarily concern whether and how to include the cost of the Strategic Reconfiguration upgrade project into the shipping rates charged by the owners of the line.
The RCA approved the 12 rate increases made since 2008 on an interim and refundable basis, but have yet to approve any permanently. If those increases are ultimately proved to be unjustified, the owners could be on the hook to refund millions of dollars.
The RCA last established permanent shipping rates on the pipeline in 2002.
Those rates, calculated under a new methodology, charge $1.25 to ship a barrel of oil from the North Slope to North Pole and $1.96 to ship to various points in Valdez.
Other cases pending In other tariff news, the Kuparuk Transportation Co. is proposing to decrease in-state shipping rates on the Kuparuk Pipeline. Under the proposed rates, the cost to ship a barrel of oil from the Kuparuk River unit to Pump Station 1 would drop to 25.6 cents, from 26.4 cents, while the rate to ship from Milne Point would drop to 18.7 cents, from 19.3 cents.
The Oliktok Transportation Co. is proposing to decrease the rate to ship natural gas liquids to the Kuparuk Transportation Co. to 58 cents per barrel from $1.97 per barrel.
The Alpine Transportation Co. is proposing to increase the rate to ship oil from the Alpine field to the Kuparuk River unit to 78 cents per barrel, up from 72 cents per barrel.
BP wants to up the rate it charges to ship on four pipelines.
Under the proposals, the rate on the Milne Point Pipeline would jump from 96 cents to $1.33 per barrel, the rate on the Endicott Pipeline would jump from $1.28 to $1.69 per barrel from the Badami connection and from $2.01 to $2.65 per barrel along the entire length, the rate on the North Star Pipeline would jump from $2.14 to $4.58 per barrel and the rate on the Badami Pipeline would jump from $7.78 to $8.37 per barrel. BP originally asked to increase the Badami rate to $44.30 per barrel, but withdrew the request.
| 