A FERC judge late Wednesday scheduled a hearing for El Paso Corp. to challenge an agency subpoena that orders the energy company to furnish documents on its deceptive price reporting activities involving an energy publication.

The Houston-based energy company filed a motion Tuesday to crush the subpoena and all other efforts to conduct discovery of its natural gas trading records, and to make a “special appearance” before the Commission judge to argue its case (see Daily GPI, Jan. 23).

Administrative Law Judge (ALJ) H. Peter Young, who issued the subpoena late last week, granted El Paso’s request to make a “special appearance” for the “limited purpose” of challenging the subpoena at a hearing set for Jan. 28. In the meantime, he ordered California regulators, state Attorney General Bill Lockyer and other parties, which requested the subpoena, to make a “good faith best effort to resolve or limit the issues” that will be addressed in the oral arguments. Young said the California parties must make a “threshold demonstration of compliance with this directive” prior to the hearing.

The California parties are seeking information about El Paso’s gas trades as part of an ongoing Commission proceeding in which they are trying to prove that the state’s wholesale power market was manipulated in 2000 and 2001, and that billions of dollars in refunds are owed to electric customers there [EL00-95-069].

They believe the information contained in the El Paso trading documents may be critical to their effort to obtain refunds for electricity customers, given that much of the power sold in the state is produced from natural gas.

The subpoena is seeking documents that El Paso provided earlier this month to the U.S. Attorney’s Office in Houston, which identified further incidents in which company employees gave false information on gas trades to the energy publication, Platts’ Inside FERC. It also directs El Paso to turn over CD recordings of “140 phone calls among El Paso employees in which plans to provide false data to trade publications are discussed, and a conversation in which [former El Paso trader] Todd Geiger allegedly defends certain non-existent trades to an Inside FERC editor.”

Geiger was arrested and charged in December with wire fraud and knowingly submitting deceptive information on gas trades to Inside FERC. He pleaded not guilty, and is awaiting trial (see Daily GPI, Dec. 5, 2002).

El Paso, which is not a party to the refund proceeding, claims the subpoena seeks information that did not involve gas trades in California. It further argues that the subpoena is at odds with FERC’s Jan. 10 order, which denied California parties access to any information that could jeopardize the agency’s ongoing probe of supplier activities in the West, as well as information obtained jointly by FERC, the Commodity Futures Trading Commission and/or the Department of Justice.

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