FERC Chief Administrative Law Judge Curtis L. Wagner said last week he expects to issue an initial decision by the end of August in a long-standing complaint case brought by California regulators, accusing El Paso Natural Gas of withholding transportation capacity from customers during the 2000-2001 heating season in an attempt to drive up prices for natural gas delivered to the Southern California border.

“I’m working on it…I have literally six inches of briefs, lots of pages [to read]” from the hearing before making a decision, Wagner told a group of reporters. “I’m suffering through them,” he said, and signaled his plan is to issue a ruling “before August is out.”

Last December, FERC directed Wagner to conduct a “supplemental” hearing into the “limited” issue of whether El Paso denied interruptible transportation service to customers from November 2000 through March 2001, a period during which the price of gas for delivery to the California border rose to the $20-$30/MMBtu level, with price spikes as high as $60/MMBtu.

The Commission re-opened the case after Wagner had rendered a split decision in October 2001. The judge found El Paso pipeline had engaged in “blatant collusion” by maneuvering the bidding process for a large block of transportation capacity on its system to favor affiliate El Paso Merchant Energy Co. But he vindicated El Paso Merchant of allegations that it illegally exercised market power to push up prices for gas delivered to Southern California beginning in mid-2000.

FERC last December, responding to a request from its Office of General Counsel’s Market Oversight and Enforcement Section (MOE), ordered Wagner to take a second look at essentially the same market-power abuse charge, but this time El Paso pipeline (rather than El Paso Merchant) was cited as the alleged offender, and the time period during which the alleged abuse was to have occurred was different — November 2000 through March 2001.

The El Paso companies argued at the time that MOE was attempting to retry the case, and that its request was an “abuse of process” and was detrimental to their rights. FERC, however, rejected their claims, saying that “contrary to the allegations of El Paso pipeline and El Paso Merchant, this remand does not abridge their due process rights.”

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