FERC last Thursday agreed to defer action in high-profile complaint case alleging gas price manipulation until June 4 to allow El Paso Corp. and California parties time to finalize their settlement and submit it to the agency, but it wasn’t happy about it.

The agency warned the parties against further hold-ups, saying “it is prepared to resolve the issues in this complaint proceeding and is concerned that additional delay…will create even greater uncertainty for the customers and markets affected” by the alleged practices of El Paso Natural Gas and affiliates.

El Paso and California were supposed to submit a final settlement to FERC by May 5, but they said they needed an additional 30 days due to the complexity and scope of the issues at stake.

Since March 21, when a settlement in principle was announced, the parties told the Commission they have “made significant progress towards preparing and finalizing a formal settlement agreement.” The deal calls for El Paso to make an estimated $1.7 billion in cash and non-cash concessions to resolve claims related to the sale or delivery of natural gas and electricity to California and three other western states from September 1996 to the present.

The settlement, if ultimately approved by the Commission, would bring to a close the three-year complaint proceeding, as well as a number of other matters.

Pushing back the settlement filing deadline to June 4 would not cause a change in the Sept. 1 effective deadline for the conversion of full-requirements service to contract-demand service on the El Paso Natural Gas pipeline system, according to the settlement parties.

In a related development on Thursday, FERC ordered the public release of all documents submitted as part of the long-standing complaint case that charges the El Paso pipeline curbed natural gas deliveries to the California market to artificially inflate prices during the western energy crisis.

The agency said the documents, which have been shielded from the public for three years under confidentiality agreements, would be released “no sooner than ten days” from the May 9 order [RP00-241].

The Commission said it decided to share the documents with the public since its “litigation process has ended,” and the principal parties to the complaint case — El Paso and California — are in the process of brokering a final settlement package to all regulatory and legal claims against the Houston-based energy company.

El Paso opposed the release of “commercially sensitive information” and certain affidavits, but the agency dismissed the company’s objections. “While the Commission is reluctant to release information that might be considered commercially sensitive, the public’s interest in reviewing and understanding the information outweighs [these] alleged concerns,” the order said.

A number of California dairy and agricultural companies pressed FERC for the public release of the documents. They argued that “disclosure will enhance the ability of the California public to understand why California natural gas prices in 2000 and 2001 rose to unprecedented levels; will deter market manipulation by gas industry participants in the future; and will demonstrate the Commission’s role as an independent and open agency which properly deals with the controversies before it,” the order noted.

The California Public Utilities Commission (CPUC) brought the complaint against El Paso Natural Gas and its power merchant affiliate, El Paso Merchant Energy, in April 2000, alleging the pipeline manipulated gas prices and violated the agency’s market-affiliate rules by showing preference to its affiliate during the bidding process for capacity on its system.

Last September, FERC’s Chief Judge Curtis Wagner Jr. found merit to the CPUC complaint, ruling that El Paso had withheld “extremely large amounts of capacity” from the California gas market in 2000-2001 to drive up prices, and had abused the market affiliate rules.

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