Chesapeake Panhandle Limited Partnership, Complainant,v.Natural Gas Pipeline Company of America, MidCon Gas Products Corp., MidCon Gas Services Corp., KN Energy, Inc. and Kinder Morgan, Inc., Respondents; Notice of Complaint

Take notice that on May 10, 2000, Chesapeake Panhandle Limited Partnership (Complainant) filed with the Federal Energy Regulatory Commission a complaint against Natural Gas Pipeline Company of America (“NGPL”), MidCon Gas Products Corp. (MidCon Gas Products), MidCon Gas Services Corp. (MidCon Gas Services), KN Energy, Inc. (KN) and Kinder Morgan, Inc. (Kinder Morgan) (collectively, Respondents) pursuant to Rule 206 of the Commission's Rules of Practice and Procedure, 18 CFR 385.206. According to the Complaint, Respondents, all affiliated companies, acted in concert to circumvent the filed rate doctrine and violate NGPL's Tariff by charging rates for gathering services which NGPL performed in connection with jurisdictional transportation services and which, in sum, exceeded the rate specified in the NGPL Tariff governing the relevant service.

Complainant alleges that from March 3, 1998 until January 1, 2000, Respondents effectively charged (i) a “gathering fee” which in certain months exceeded the Maximum rate NGPL, a jurisdictional provider of gathering services through NGPL's West Panhandle Gathering System, was authorized to charge and (ii) a fuel retention rate for gathering service provided by NGPL, which was not included in NGPL's filed Tariff. The “gathering fee” and fuel retention rate were established in a Gas Sales and Purchase Agreement (GAS Sales Agreement) which MC Panhandle, Inc. (MC Panhandle), an affiliate of NGPL, had initially executed with another NGPL affiliate, MidCon Gas Services. MidCon Gas Services' interest was later transferred by assignment to MidCon Gas Products. Complainant states that, in 1998, it acquired ownership of MC Panhandle, the owner of certain gas wells in Moore and Carson Counties, Texas, subject to the terms of the Gas Sales Agreement. It avers that through this purchase it became obligated to pay, and in fact paid (through a reduced gas sales price), rates for gathering services actually performed by NGPL that were greater than the applicable rates set forth in NGPL's FERC Gas Tariff.

According to the Complainant, although the Gas Sales Agreement was nominally between MC Panhandle (later succeeded by Chesapeake Panhandle) and MidCon Gas Services (later succeeded by its affiliate MidCon Gas Products), NGPL's role in the transaction as: (1) The provider of the gathering service, (2) the affiliate of the Gas Sales Agreements's Buyers, MidCon Gas Services and MidCon Gas Products, (3) the affiliate of the Gas Sales Agreement's initial Seller, MC Panhandle, and (4) a signatory to the Gas Sales Agreement, effectively make NGPL a party to the Gas Sales Agreement and, in any event, support the inference that NGPL benefited from the actions of its affiliates in charging a rate for services which NGPL provided, but for which NGPL itself could not lawfully have charged. Thus, Complainant seeks a refund, with interest, of the amounts it was charged (by way of a gas sales price reduction) for “gathering fees” in excess of NGPL's authorized gathering rate and fuel retainage during the period from March 3, 1998 through December 31, 1999.

Questions concerning the Complaint may be directed to counsel for Complainant, James F. Bowe, Jr., Dewey Ballantine LLP, 1775 Pennsylvania Ave., NW, Washington, DC 20006-4605, Phone 202/429-1444, Fax 202/862-1093, e-mail jbowe@deweyballantine.com.

Any person desiring to be heard or to protest this filing should file a motion to intervene or protest with the Federal Energy Regulatory Commission, 888 First Street, NE, Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). All such motions or protests must be filed on or before May 30, 2000. Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a motion to intervene. Copies of this filing are on file with the Commission and are Available for public inspection in the Public Reference Room. This filing may also be viewed on the Internet at http://www.ferc.fed.us/online/rims.htm (call 202-2222) for assistance. Answers to the complaint shall also be due on or before May 30, 2000.