RCA extending quality bank timeline

State regulators are taking a little more time to decide whether they should re-examine the system used to value the various crude stocks moved on the trans-Alaska oil pipeline.

The Regulatory Commission of Alaska now plans to make a decision by Nov. 11.

Flint Hills Resources Alaska LLC filed a complaint in August against BP, ConocoPhillips and ExxonMobil — the owners of the pipeline — saying the system for determining crude values needed to be revamped to account for market changes.

The complaint concerns the methodology for determining the “quality bank,” which is a fund used to compensate shippers when the value of crude oil that a company removes from the end of the pipeline differs from the value of crude the company put into the pipeline. This phenomenon arises because numerous companies are shipping varying qualities of crude oil through the 800-mile pipeline at the same time.

The pipeline owners refrained from commenting on the complaint other than to campaign for the status quo — a relatively simple formula used both for intrastate and interstate shipments — but third parties Anadarko Petroleum Corp. and Tesoro Petroleum asked the RCA to throw out the complaint. They said the market changes Flint Hills identified had failed to meet the standard required for changing the quality bank methodology.

While the RCA is required to decide within 30 days of receiving a complaint whether to launch an investigation, the commission can extend the timeline to accommodate additional filings. The new Nov. 11 timeline will give the RCA time to consider the request to dismiss the case before deciding whether or not to launch an investigation.

—Eric Lidji