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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