[Federal Register Volume 61, Number 103 (Tuesday, May 28, 1996)] [Notices] [Pages 26514-26515] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 96-13245] ----------------------------------------------------------------------- DEPARTMENT OF ENERGY Office of Hearings and Appeals Implementation of Special Refund Procedures AGENCY: Office of Hearings and Appeals, Department of Energy. ACTION: Notice of Implementation of Special Refund Procedures. ----------------------------------------------------------------------- SUMMARY: The Office of Hearings and Appeals (OHA) of the Department of Energy announces the procedures for disbursement of $1,140,552.84 (plus accrued interest) in alleged or adjudicated crude oil overcharges obtained by the DOE from Gil-Mc Oil Corporation (Case No. LEF-0054), LeClair Operating Company (Case No. LEF-0054), SRG Corporation (Case No. LEF-0056), Petroleum Carrier Company (Case No.LEF-0119) and Dane Energy Company (LEF-0122). The OHA has determined that the funds obtained from these firms, plus accrued interest, will be distributed in accordance with the DOE's Modified Statement of Restitutionary Policy in Crude Oil Cases, 51 Fed. Reg. 27899 (August 4, 1986). FOR FURTHER INFORMATION CONTACT: Richard T. Tedrow, Deputy Director, Office of Hearings and Appeals, Washington, DC 20585, (202) 426-1562. SUPPLEMENTARY INFORMATION: In accordance with 10 CFR 205.282(c), notice is hereby given of the issuance of the Decision and Order set forth below. The Decision and Order sets for the procedures that the DOE has formulated to distribute a total of $1,140,553, plus accrued interest, remitted to the DOE by Gil-Mc Oil Corporation, LeClair Operating Company, SRG Corporation, Petroleum Carrier Company, and Dane Energy Company. The DOE is currently holding these funds in interest bearing escrow accounts pending distribution. The OHA will distribute these funds in accordance with the DOE's Modified Statement of Restitutionary Policy in Crude Oil Cases, 51 FR 27899 (August 4, 1986) (the MSRP). Under the MSRP, crude oil overcharge monies are divided among the federal government, the states, and injured purchasers of refined petroleum products. Refunds to the states will be distributed in proportion to each state's consumption of petroleum products during the price control period. Refunds to eligible purchasers will be based on the volume of petroleum products that they purchased and the extent to which they can demonstrate injury. Because the June 30, 1995, deadline for the crude oil refund applications has passed, no new applications from purchasers of refined petroleum products will be accepted for the 20 percent of these funds allocated to individual claimants. Instead, that share of the funds will be added to the general crude oil overcharge pool used for direct restitution. Dated: May 16, 1996. George B. Breznay, Director, Office of Hearings and Appeals. Decision and Order of the Department of Energy Implementation of Special Refund Procedures Names of Firms: Gil-Mc Oil Corporation, LeClair Operating Company, SRG Corporation, Petroleum Carrier Company, Dane Energy Company. Dates of Filings: July 20, 1993, December 7, 1993, April 8, 1994. Case Numbers: LEF-0054, LEF-0055, LEF-0056, LEF-0119, LEF-0122. The Economic Regulatory Administration (ERA) of the Department of Energy filed five Petitions for the Implementation of Special Refund Procedures with the Office of Hearings and Appeals (OHA), to distribute funds remitted to the DOE pursuant to settlements between Gil-Mc Oil Corporation (Gil-Mc), LeClair Operating Company (LeClair), SRG Corporation (SRG), Petroleum Carrier Company, (Petroleum Carrier), and Dane Energy Company (Dane). A total of $1,140,553, plus interest, is available for restitution. All of these funds are now being held in an interest-bearing account pending a determination regarding their proper disposition. In accordance with the procedural regulations codified at 10 C.F.R. Part 205, Subpart V, the ERA requests in its Petitions that the OHA establish special refund procedures to remedy the effects of any regulatory violations which were resolved by these settlements. This Decision and Order sets forth the OHA's final plan to distribute these funds. For a more detailed discussion of Subpart V and the authority of the OHA to fashion procedures to distribute refunds, see Petroleum Overcharge Distribution and Restitution Act of 1986, 15 U.S.C. Secs. 4501-07 (PODRA), Office of Enforcement, 9 DOE para. 82,508 (1981), and Office of Enforcement, 8 DOE para. 82,597 (1981). I. Background On June 16, 1982, the DOE issued a Proposed Remedial Order (PRO) to Gil-Mc which alleged that certain first sales of crude oil by Gil-Mc had been in excess of applicable ceiling prices during the period August 19, 1973 through January 27, 1981. The DOE and Gil-Mc entered into a Consent Order on March 29, 1983, which satisfied the DOE's claim against Gil-Mc. There is a total of $10,273, plus interest, available from Gil-Mc for restitution. On June 3, 1982, the DOE issued a PRO to LeClair which alleged that certain first sales of crude oil by LeClair had been in excess of applicable ceiling prices during the period August 19, 1973 through January 27, 1981. The DOE and LeClair entered into a Consent Order on November 5, 1982, which satisfied the DOE's claim against LeClair. There is a total of $70,386, plus interest, available from LeClair for restitution. On July 23, 1982, the DOE entered into a Consent Order with SRG which resolved DOE's claims against SRG. Specifically, the DOE alleged that during the period of August 19, 1973 through January 27, 1981, crude oil was sold from certain properties operated by SRG in excess of the applicable lawful ceiling prices. There is a total of $171,041, plus interest, available from SRG for restitution. On June 26, 1987, the DOE issued a Remedial Order to Petroleum Carrier for violations of the crude oil pricing regulations during the period from June 1974 through December 1977. The DOE collected a total of $18,853 from Petroleum Carrier pursuant to the Remedial Order. That amount, plus interest, is available for restitution. On December 10, 1992, the DOE issued a Remedial Order to Dane for violations of the crude oil pricing regulations during the period December 1978 through December 1980. The DOE and Dane entered into a Consent Order on December 16, 1993, which [[Page 26515]] satisfied the DOE's claim against Dane. There is a total of $870,000, plus interest, available from Dane for restitution. II. The Proposed Decisions On October 26, 1993, May 20, 1994, and June 6, 1994, we issued Proposed Decisions and Orders (PDOs) that tentatively concluded that ERA's Petitions to implement Subpart V proceedings with respect to the funds collected from these five firms should be approved. Gil-Mc Oil Corp., 58 FR 57595 (October 26, 1993) (also included LeClair and SRG); Petroleum Carrier Co., 59 FR 26493 (May 20, 1994); Dane Energy Co., 59 FR 29287 (June 6, 1994). In each of the PDOs, we tentatively determined that the funds obtained from these firms should be distributed in accordance with the DOE's Modified Statement of Restitutionary Policy in Crude Oil Cases, 51 FR 27899 (August 4, 1986) (the MSRP). The MSRP was issued as a result of a court- approved Settlement Agreement. In re: The Department of Energy Stripper Well Exemption Litigation, 653 F. Supp. 108 (D. Kan. 1986) (the Stripper Well Settlement Agreement). The MSRP establishes that 40 percent of the crude oil funds will be remitted to the federal government, another 40 percent to the states, and up to 20 percent may be initially reserved for payment of claims to injured parties. The MSRP also specifies that any monies remaining after all valid claims by injured purchasers are paid be disbursed to the federal government and the states in equal amounts. The OHA has utilized the MSRP in all Subpart V proceedings involving alleged crude oil violations. See Order Implementing the MSRP, 51 FR 29689 (August 20, 1986). This Order provided a period of 30 days for filing of comments or objections to our proposed use of the MSRP as the groundwork for evaluating claims in crude oil refund proceedings. Following this period, the OHA issued a Notice evaluating the numerous comments which it had received pursuant to the Order Implementing the MSRP. This notice was published at 52 FR 11737 (April 10, 1987). The April 10, 1987 Notice contained guidance to assist potential claimants wishing to file refund applications for crude oil monies under the Subpart V regulations. Generally, all claimants would be required to (1) document their purchase volumes of petroleum products during the August 19, 1973 through January 27, 1981 crude oil price control period, and (2) show that they were injured by the alleged crude oil overcharges. We also specified that end-users of petroleum products whose businesses were unrelated to the petroleum industry will be presumed to have been injured by the alleged crude oil overcharges. End-users, therefore, need only submit documentation of their purchase volumes. See City of Columbus, Georgia, 16 DOE para. 85,550 (1987). Additionally, we stated that we would calculate crude oil refunds on a per gallon (or volumetric) basis. We obtained this figure by dividing the crude oil refund pool by the total consumption of petroleum products in the United States during the crude oil price control period. OHA is currently paying crude oil refund claims at the rate of $0.0016 per gallon. We will decide whether sufficient crude oil overcharge funds are available for additional refunds when we are better able to determine how much additional money will be collected from firms that have either outstanding obligations to the DOE or enforcement cases currently in litigation. III. The Refund Procedure No comments were received on the PDOs, and we adopt the tentative determination to distribute these funds in accordance with the MSRP. These standard crude oil procedures will be used to distribute the funds remitted by Gil-Mc, LeClair, SRG, Petroleum Carrier and Dane. Accordingly, we shall initially reserve 20 percent of these funds, $228,110.56, plus accrued interest, for direct refunds to claimants in order to ensure sufficient funds will be available for injured parties. As we have stated in prior decisions, a crude oil refund applicant need only submit one application for its share of all available crude oil overcharge funds. See, e.g., A. Tarricone, Inc., 15 DOE para. 85,495 (1987). June 30, 1995, was the final deadline for filing Applications for Refund from the crude oil funds. See 60 FR 19914 (April 21, 1995). A party that submitted a timely claim in the crude oil refund proceeding need not file another claim in order to share in the funds at issue in this Decision. Under the terms of the MSRP, the remaining 80 percent of the funds collected from these five firms shall be disbursed in equal shares to the states and the federal government for indirect restitution. Refunds to the states will be in proportion to the consumption of petroleum products in each state during the period of price controls. The share or ratio of the funds which each state will receive is contained in Exhibit H of the Stripper Well Settlement Agreement, 6 Fed. Energy Guidelines para. 90,509 at 90,687. When disbursed, these funds will be subject to the same limitations and reporting requirements as all other crude oil monies received by the states under the Stripper Well Settlement Agreement. It Is Therefore Ordered That: The Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller of the Department of Energy shall take all steps necessary to transfer $10,273, plus all accrued interest, from the Gil-Mc subaccount (Account No. 670C00339T), $70,386, plus all accrued interest from the LeClair subaccount (Account No. 600C20071T), $171,041, plus all accrued interest from the SRG subaccount (Account No. 400C00200T), $18,853, plus all accrued interest from the Petroleum Carrier subaccount (Account No. 6A0X00253Z) and $870,000, plus all accrued interest, from the Dane subaccount (Account No. 6A0X00320Z), for a total of $1,140,553, plus all accrued interest, pursuant to Paragraphs (2), (3), and (4) of this Decision. (2) The Director of Special Accounts and Payroll shall transfer $456,221 (plus interest) of the funds obtained pursuant to Paragraph (1) above into the subaccount denominated ``Crude Tracking-- States,'' Number 999DOE003W. (3) The Director of Special Accounts and Payroll shall transfer $456,221 (plus interest) of the funds obtained pursuant to Paragraph (1) above into the subaccount denominated ``Crude Tracking-- Federal,'' Number 999DOE002W. (4) The Director of Special Accounts and Payroll shall transfer $228,111 (plus interest) of the funds obtained pursuant to Paragraph (1) above into the subaccount denominated ``Crude Tracking-- Claimants 4,'' Number 999DOE010Z. (5) This is a final Order of the Department of Energy. Dated: May 16, 1996. George B. Breznay, Director, Office of Hearings and Appeals. [FR Doc. 96-13245 Filed 5-24-96; 8:45 am] BILLING CODE 6450-01-P