ANSWER OF SFPP, L.P. TO COMPLAINT OF CONOCOPHILLIPS COMPANY AND COMPLAINT OF CHEVRON PRODUCTS COMPANY AGAINST THE BASE RATES OF SFPP, L.P

UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION ConocoPhillips Company v. Docket No. OR11-13-000 SFPP, L.P. Chevron Products Company v. Docket No. OR11-16-000 SFPP, L.P. (not consolidated) ANSWER OF SFPP, L.P. TO COMPLAINT OF CONOCOPHILLIPS COMPANY AND COMPLAINT OF CHEVRON PRODUCTS COMPANY AGAINST THE BASE RATES OF SFPP, L.P. Pursuant to 18 C.F.R. 343.4(a) and 385.213 (2011), 49 U.S.C. app. 13(1) and 15(1), and the Notices of Complaint issued in this proceeding on June 14, 2011 by the Federal Energy Regulatory Commission (FERC or Commission), SFPP, L.P. (SFPP) hereby answers the Complaint of ConocoPhillips Company (Conoco) Against the Base Rates of SFPP, L.P. (Conoco Complaint) and the Complaint of Chevron Products Company (Chevron) Against the Base Rates of SFPP, L.P. (Chevron Complaint), both filed on June 13, 2011.1 The Complainants challenge the justness and reasonableness of the interstate rates on SFPPs pipeline system.2 They request that the Commission find that the rates established by SFPP in its FERC Tariff Nos. 195.0.0 (Sepulveda Line), 196.2.0 (West Line - Watson / East Hynes to Calnev Pipe Line LLC), 197.0.0 (East Line), 198.2.0 (West Line - Watson / East Hynes to Colton Transmix Facility and Phoenix), 199.0.0 (North Line), and 200.0.0 (Oregon Line), 1 SFPP refers to Conoco and Chevron collectively as the Complainants and to the Conoco Complaint and the Chevron Complaint collectively as the Base Rate Complaints. 2 Conoco Complaint at PP 1-2; Chevron Complaint at PP 1-2. including all predecessor tariffs, supplements, and re-issuances, are unjust and unreasonable, set the Base Rate Complaints for hearing, prescribe new rates for SFPP that are just and reasonable, and order SFPP to pay reparations.3 The Complainants also challenge SFPPs rates that are grandfathered under the Energy Policy Act of 1992, Pub. L. 102-486 1803, 106 Stat. 2776, 3011 (1992) (EPAct).4 For the reasons discussed below, the Commission should hold the Base Rate Complaints in abeyance pending the outcome of a settlement process SFPP is proposing in a separate motion to be filed contemporaneously with this answer. If SFPPs proposed settlement process is not initiated or is unsuccessful, the Commission should: (1) dismiss the complaints as to SFPPs North and Oregon Line rates because the Complainants have failed to meet the threshold standard for challenging rates that are grandfathered under EPAct and (2) hold the challenges against SFPPs remaining rates in abeyance pending developments in other pending proceedings. I. COMMUNICATIONS AND CORRESPONDENCE Pursuant to Rule 2010 of the Commissions Rules of Practice and Procedure, 18 C.F....