Is TransCanada required to provide fuller public disclosure …

Under the regulations of the Federal Energy Regulatory Commission (FERC) governing the Alaska Open Season, the Alaska Pipeline Project (TransCanada) is prohibited from selectively disclosing “non-public transmission function information” to any of its “affiliates” engaged or potentially engaged in the marketing of gas.  18 CFR 358.6.  Under the same set of FERC regulations, “non-public transmission function information” includes information about bids submitted in the Open Season not otherwise made public to all potential shippers.

Because the state has the right to take its royalty gas in kind and separately market it to others, the state is potentially engaged in the marketing of gas.  Because of its authority, under AGIA, to “direct the management policies” of the Alaska Pipeline, the state also appears to meet the definition of an “affiliate” of the project.  18 CFR 358.3(a)(3).   As a result, as with any other marketing affiliate of the project, TransCanada is prohibited from selectively disclosing non-public open season information to the state.

Notwithstanding the FERC’s explicit rule, TransCanada may have selectively disclosed its open season results to the state.  According to an article in the July 30 Alaska Dispatch (“TransCanada touts substantial interest in Alaska gas line“), “Marty Rutherford, who heads the state’s gas line team, said the state was notified about an hour after the bids closed about the results. ‘It is extremely good news and it is what we hoped,’ she said.”

Although the article does not identify what information was disclosed to the state, in order for Rutherford to reach the conclusion that “it is extremely good news and … what we hoped,” it appears that the information disclosed to the state may have been more than what TransCanada provided others.  If TransCanada disclosed more information to the state than it has to other potential shippers, TransCanada may have violated the FERC’s regulations.

A pipeline violating this portion of the FERC’s regulations “must immediately post the information that was disclosed on [the pipeline’s] Internet Web site.”  18 CFR 358.7(a).  TransCanda’s Alaska Pipeline website this morning does not disclose what information has been provided to the state.  In the words of the applicable FERC regulations, TransCanada is required to supplement the disclosures made on its website “immediately” if it has disclosed more information about the results of the Open Season to the state than it has to others.

2 responses to “Is TransCanada required to provide fuller public disclosure …

  1. Very nicely done. I just wish that you were in an oversight position and able to confirm or deny your canny observations. This whole thing has been a mess from the first and the kind and quality of information, including information about the FERC requirements, has been hard to find in the public dialogue. Thank you for filling the gap on this.