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Colorado Interstate Gas Company; Notice of Offer of Settlement

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Start Preamble Start Printed Page 15624 March 17, 2000.

Take notice that on March 8, 2000, Colorado Interstate Gas Company (CIG), The Public Service Company of Colorado (PSCo), Cheyenne Light Fuel and Power Company (Cheyenne) and Colorado Springs Utilities (Colorado Springs) (collectively called Sponsoring Parties) jointly filed an Offer of Settlement under Rule 602 of the Commission's Rules of Practice and Procedure in the captioned docket. Sponsoring Parties filed the Offer of Settlement relating to refunds of the Kansas ad valorem taxes to resolve for Consenting Working Interest Owners (as defined in the Offer) the issue of refunds due to CIG for reimbursements of the Kansas ad valorem taxes consistent with the requirements of Public Service Company of Colorado v. FERC[1] and the Commission's subsequent orders. A copy of the Offer of Settlement, is on file with the Commission and is available for public inspection in the Public Reference Room. The Offer of Settlement may be viewed on the web at​online/​rims.htm (call 202-208-2222 for assistance).

Under the Offer of Settlement, each Consenting Working Interest Owner's refund liability will be reduced by 12.5% which represents the typical landowners royalty share of the total refunds. In addition, each Consenting Working Interest Owner will receive an additional reduction in its refund liability of $10,000, except where a lesser amount will extinguish its liability in its entirety.

The Offer of Settlement, when approved, will eliminate substantially, if not entirely, the obligation of Consenting Working Interest Owners to pursue refund claims against their landowner royalty owners. This is accomplished through the 12.5% reduction in the total refund obligation otherwise owed by Consenting Working Interest Owners.

An estimated 600 or more working interest owners received the benefit of CIG's reimbursement of the Kansas ad valorem taxes. Many of those parties have small refund obligations. The Settlement will eliminate entirely the refund obligations of those Consenting Working Interest Owners whose remaining refund obligation after the 12.5% reduction discussed above is $10,000 or less. It is estimated that 400-450 working interest owners' refunds will be entirely eliminated under the Settlement.[2] Further, every other Consenting Working Interest Owner whose refund obligation, after the 12.5% reduction, exceeds $10,000 will have that refund obligation reduced by $10,000 under the Settlement. Thus the Settlement will reduce the collection and administrative burdens on the parties and the Commission while expediting the recovery of the refunds.

In accordance with Section 385.602(f), initial comments on the Offer of Settlement are due on March 28, 2000 and any reply comments are due on April 7, 2000.

Start Signature

David P. Boergers,


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1.  91 F.3d 1478 (D.C. Cir., 1996), cert. denied 520 U.S. 1227 (1997).

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2.  The Sponsoring Parties assert that the number and identity of the working interest owners who will have their refund obligation eliminated by the Settlement cannot be determined at this time since the Commission had required that the well operators—the parties to whom CIG made the tax reimbursements in the first place—provide working interest ownership data to CIG. Since a very large number of well operators have not provided that information to CIG, CIG, PSCo and Colorado Springs also filed a Complaint against those well operators in Docket No. RP00-213-000.

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[FR Doc. 00-7157 Filed 3-22-00; 8:45 am]