ConocoPhillips to Pay $545,000 Civil Penalty Under Settlement with FERC

ConocoPhillips Company has agreed to pay a civil penalty of $545,000 and to disgorge $3,174,900 plus interest to resolve FERC Enforcement Staff's allegations that ConocoPhillips violated various posting and bidding requirements and shipper-must-have-title requirements.

Enforcement Staff, "concluded that ConocoPhillips and its affiliate Brandywine Industrial Gas Inc. (Brandywine) obtained releases of discounted rate short-term capacity on an alternating monthly basis, without complying with the Commission's posting and bidding requirements, under prearranged deals with the releasing shipper. The deals occurred on four different pipelines involving a total of seven releasing shippers, and ranged in duration from two months to more than two years. By alternating the replacement shipper in discounted rate transactions on an every-other month basis, Enforcement concluded that ConocoPhillips was able to secure long-term discounted capacity without complying with the posting and bidding requirements of 18 C.F.R. § 284.8."

Enforcement Staff also, "concluded that ConocoPhillips used the capacity alternately released to it and its affiliate to ship a volume of gas of 16.9 Bcf. Enforcement concluded ConocoPhillips earned a total of $322,742 in unjust profits associated with these transactions"

"Enforcement determined that ConocoPhillips shipped 73.6 Bcf of gas in violation of the shipper-must-have-title requirement. ConocoPhillips earned a total of $2,582,158 in unjust profits associated with the shipper-must-have-title violations that are the subject of this Order."

ConocoPhillips neither admits nor denies Enforcement's conclusions that the conduct violated any rule, regulation or statute.