FERC Thursday denied rehearing of a November 2007 order on remand in which it declared Transcontinental Gas Pipe Line’s (Transco) pipeline network located onshore and offshore Louisiana to be transmission in nature and thus subject to agency jurisdiction.

The case has a long, circuitous history at the Federal Energy Regulatory Commission and in the courts. In August 2001 FERC ruled that the Transco facilities in question were unregulated, exempt gathering and could be spun down to affiliate Williams Gas Processing-Gulf Coast Co. However, the Commission reversed the order in April 2005, finding that Transco’s facilities downstream of an interconnection with Jupiter Energy Corp. were transmission subject to FERC jurisdiction (see Daily GPI, April 21, 2005). Transco challenged the decision in the U.S. Court of Appeals for the District of Columbia Circuit, which in December 2006 vacated the order and remanded it to FERC (see Daily GPI, Dec. 20, 2006).

In the latest order denying rehearing, FERC said it found that jurisdictional transmission was the primary function of Transco’s 12.43-mile long, 24-inch diameter offshore lateral that receives gas from Jupiter Energy’s facilities in Vermilion Block 22 and transports it to shore, where it enters Transco’s other jurisdictional transmission facilities. The Commission held that the 12.43-mile offshore segment at issue was really part of what was one continuous 37-mile, 24-inch diameter pipeline, of which 24.63 miles were located onshore [CP01-368, CP01-369].

“While the 24-inch diameter pipeline was constructed, as Transco and Williams emphasize, in two stages — first to the shoreline and 10 years later out to Vermilion Block 22 — the Commission finds that the offshore and onshore portions of the pipeline serve the same function: the jurisdictional transmission of gas for 37 miles from Vermilion Block 22 to the onshore Cow Island plant,” the order said.

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