Pipeline Companies Want to Charge Market-Based Crude Oil Rates

West Texas Gulf Pipe Line Co. LLC and Permian Express Partners LLC are challenging the Federal Energy Regulatory Commission’s decision to deny their application to charge market-based rates to ship crude oil to Tyler, Texas.

They told the US Court of Appeals for the Fifth Circuit that FERC’s decision was an abuse of discretion under the Administrative Procedure Act, and violated the Interstate Commerce Act.

• The companies claimed pipelines can charge market-based rates if they show they aren’t able to exercise market power
• FERC didn’t look at pro-competitive factors, deduct “local production from market demand,” or consider “unused but usable ...