While he strongly supports a money settlement between parties in the high profile case alleging affiliate and market-power abuse on the part of El Paso Corp. subsidiaries, FERC Chief Administrative Law Judge Curtis Wagner Jr. indicated that he won’t postpone issuing his initial decision to accommodate settlement negotiations. Assuming a settlement is not brokered, Wagner said he “feels strongly that this case should proceed to decision at the very earliest possible date.”

His statement, which was included in a Sept. 7 order, was in response to a joint request of El Paso Merchant Energy Co. L.P. (EPME) and El Paso Natural Gas (EPNG) for Wagner to designate a judge and allow him 60 days to negotiate a settlement between the parties. The El Paso affiliates further asked Wagner to suspend issuing an initial decision in the case, which he has vowed to do by Oct. 9, until after the 60-day settlement period ends.

But Wagner pointed out that FERC Chairman Pat Wood made it clear in an earlier order related to the case that it “[was] critical that the Commission act expeditiously on [the] complaints.” He noted that former Chairman Curt Hebert echoed a similar sentiment. In addition, Wagner said he has promised the Commission an initial decision by early October.

“Under these circumstances, the Chief Judge does not feel he has authority to change the date for the issuance of the initial decision,” he noted.

Wagner will not rule on the El Paso affiliates’ request for a settlement judge until after parties in the case file their answers to the request, which are due at FERC by noon on Tuesday. Parties can either e-mail or hand-deliver a “courtesy copy” of any response to his office by then, Wagner said.

In the high-profile complaint case, the California Public Utilities Commission (CPUC) has charged that EPME intentionally withheld capacity from the market to drive up delivered prices for gas in California beginning in mid-2000, and that El Paso pipeline violated the Commission’s affiliate standards by rigging the bidding process to favor affiliate EPME during a February 2000 open season [RP00-241]. EPME was awarded 1.22 Bcf/d of capacity on affiliate El Paso pipeline, which was more than one-third of the total capacity on its line. The 15-month contracts for the capacity expired in May.

In a procedural order issued in late August, Wagner urged the CPUC and El Paso affiliates to give “serious consideration to disposing of this case by a negotiated settlement,” adding that it “would be in the interest of all” concerned (See Daily GPI, Aug. 31).

In their petition for a settlement judge, the El Paso affiliates agreed with Wagner. “This ongoing litigation — which, as the chief judge has recognized, is far from over — has proved to be a continuing drain on the resources of EPME and EPNG,” they said last week (See Daily GPI, Sept. 10). “This is likely to be true for other parties, as well.” The El Paso companies argued that a settlement judge could bring a “dose of reality” to a case in which “each side remains resolute in its litigation position.”

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