Dispute continues over Unocal TAPS share

Kristen Nelson

Petroleum News

Unocal Pipeline Co. told the Regulatory Commission of Alaska Sept. 26 that it is still not in a position to file an application to transfer its operating authority in the Trans Alaska Pipeline System.

Unocal said that, as it has explained in earlier filings, Unocal and the other carriers - BP Pipelines (Alaska) Inc., Exxon Mobil Pipeline Co., and ConocoPhillips Transportation Alaska Inc.- “are arbitrating their dispute, as well as litigating portions of the dispute so that the transfer process can move forward.”

Unocal Pipeline requested commission authorization to temporarily suspend service on its share of pipeline capacity in June 2012, “pending the finalization of the sale of its ownership interest.” Unocal told the commission then that it owned the smallest interest of any of the owners, just 1.36 percent. The company said its share could be sold or transferred to “a third party, another TAPS Owner, or all of the remaining TAPS owners,” and said once details of the sale or transfer were established, it would submit an application to RCA for approval of the transfer.

The TAPS operating agreement was up for a five-year renewal in 2012. “Unocal has decided not to continue TAPS operations for an additional renewal term because its interest in TAPS no longer meets the company’s core strategic needs,” Unocal told RCA in 2012.

In its September filing for an extension the company said, “The litigation has been time-consuming and is likely to continue for a significant period of time.”

The commission said in an Oct. 12 order that Unocal has said it is still not in a position to file an application to transfer its operating authority and proposes to file by March 1, 2019, or explain why the application cannot be filed.

RCA has granted the extension until March 1.

- KRISTEN NELSON