Northern Border Settlement Approved
FERC approved Northern Border Pipeline Co.'s rate settlement,
which converts the pipeline's rate design to straight-fixed
variable from cost of service and which imposes a moratorium on
rate changes until Nov. 1, 2005.
"This settlement brings rate certainty to our customers for the
next five years and it allows Northern Border Pipeline the
opportunity to offer new services to customers within the
provisions of the settlement," said Bill Cordes, president of
Northern Plains Natural Gas, operator of Northern Border.
Cordes also noted that the pipeline system continues to be
highly utilized. "As expected, Northern Border Pipeline is
operating at contracted capacity even after the commencement of
operations of Alliance Pipeline," Cordes said.
Northern Border Pipeline will apply its rate of $0.037 per 100
dekatherm miles on a uniform, system-wide mileage basis. Full
conversion of pipeline operations to the stated rate form of tariff
will be effective Feb. 1, 2001. Implementation of the new tariff
will result in estimated refunds to the customers of $30 million,
the majority of which the pipeline company intends to disburse
prior to Dec. 31. No earnings impact is expected as the refunds
were anticipated and fully reserved.
The Northern Border pipeline extends 1,214 miles from a
connection with Foothills Pipeline at the Canadian border in
northeastern Montana to Chicago.
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