94-26349. Southern Natural Gas Co.; Notice of Petition for Declaratory Order

[Federal Register Volume 59, Number 205 (Tuesday, October 25, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-26349]


[[Page Unknown]]

[Federal Register: October 25, 1994]


-----------------------------------------------------------------------

DEPARTMENT OF ENERGY
[Docket No. RP95-12-000]

 

Southern Natural Gas Co.; Notice of Petition for Declaratory 
Order

October 19, 1994.
    Take notice that on October 13, 1994, Southern Natural Gas Company 
(Southern) filed in Docket No. RP95-12-000 a Petition for Declaratory 
Order pursuant to Rule 207 of the Federal Energy Regulatory 
Commission's (Commission) Rules of Practice and Procedure. Southern 
requests that the Commission declare that a certain payment that 
Southern proposes to make to purchase an annuity for purposes of 
reducing the payment obligations arising under a restructuring of 
Southern's gas purchase contract with Jim Walter Resources, Inc. (JWR), 
pursuant to the Commission's Order No. 636, et al., will qualify as a 
GSR cost as that term is defined in Section 31.2 of the General Terms 
and Conditions of Southern's FERC Gas Tariff, Seventh Revised Vol. No. 
1. The petition is on file with the Commission and open to public 
inspection.
    Southern's GSR settlement with JWR provides that Southern will make 
monthly payments of $675,000 to JWR through the year 2001. In order to 
reduce the total amount of this GSR cost, Southern proposes to make a 
lump-sum payment to a financial institution to purchase an annuity or 
other similar financial instrument (Annuity) at a net present 
discounted value to provide these monthly payments.
    Southern does not seek as part of this Declaratory Order any 
determination on the prudence or eligibility of such one-time payment 
or the prudence and eligibility of the settlement payments to JWR. Nor 
does Southern seek to revise its Tariff or GSR recovery mechanisms to 
allow for open-ended recovery of hedging costs or the costs of other 
financial instruments. Southern seeks in this proceeding the 
Commission's determination regarding whether the proposed purchase of 
an Annuity (which would eliminate Southern's need to include in its 
quarterly GSR filing the $675,000 monthly payments to JWR) would 
constitute an appropriate incurred cost under Section 31.2(a) of 
Southern's Tariff, and thereby qualify as a GSR expense that Southern 
has incurred for which Southern could file to recover in accordance 
with the GSR recovery mechanisms provided for in Southern's Tariff.
    Upon receipt of the requested declaratory order and completion of 
the proposed transaction, Southern would make a compliance filing to 
remove the charges presently associated with the monthly payments of 
$675,000 and replace such with the Annuity purchase amount as recovered 
under the 3-year period provided for in Southern's Tariff.
    Any person desiring to be heard or make any protest with reference 
to said petition should file a motion to intervene or protest with the 
Federal Energy Regulatory Commission, Washington, DC 20426, in 
accordance with the requirements of the Commission's Rules of Practice 
and Procedure (18 CFR 385.214 or 385.211). All such motions or protests 
should be filed on or before November 2, 1994. All protests filed with 
the Commission will be considered by it in determining the appropriate 
action to be taken but will not serve to make the protestants parties 
to the proceeding. Any person wishing to become a party to must file a 
motion to intervene in accordance with the Commission's Rules. Copies 
of this filing are on file with the Commission and are available for 
public inspection.
Lois D. Cashell,
Secretary.
[FR Doc. 94-26349 Filed 10-24-94; 8:45 am]
BILLING CODE 6717-01-M