ENERGY CONSUMERS, ETC. v. Dept. of Energy, 10-21.
Citation | 632 F.2d 129 |
Decision Date | 04 April 1980 |
Docket Number | No. 10-21.,10-21. |
Parties | ENERGY CONSUMERS AND PRODUCERS ASSOCIATION, INC., formerly Oklahoma Association of Energy Consumers and Producers, Inc., Plaintiff-Appellee, v. DEPARTMENT OF ENERGY, Defendant-Appellant. |
Court | U.S. Temporary Emergency Court of Appeals |
Dina R. Lassow, Dept. of Justice, Washington, D. C., with whom Alice Daniel, Acting Asst. Atty. Gen. of the Civ. Div., Dept. of Justice, C. Max Vassanelli of the Dept. of Justice, Washington, D. C., John P. McKenna, Arthur E. Gowran and Frank W. Krogh, Dept. of Energy, Washington, D. C., were on the brief for defendant-appellant Department of Energy.
Fred A. Gipson, Seminole, Okl., with whom Richard L. Bohanon and Lynn A. Pringle of Bohanon & Barth, Oklahoma City, Okl., and Richard S. Roberts, Wewoka, Okl., were on the brief for plaintiff-appellee, Energy Consumers and Producers Ass'n, Inc., formerly Oklahoma Ass'n of Energy Consumers and Producers, Inc.
Before CHRISTENSEN, JOHNSON and BECKER, Judges.
On this appeal the appellant Department of Energy (DOE) assigns error in the ruling of the district court adjudging invalid Part III of Ruling 1975-12, which was issued on August 29, 1975 by the General Counsel of the Federal Energy Administration (FEA), predecessor of DOE, as an interpretative ruling, without prior public notice and opportunity to comment required by paragraphs (b) and (c) of § 553, Title 5 U.S.C., a part of the Administrative Procedure Act (APA), codified as Subchapter II, § 551 to § 559 inclusive, Title 5 U.S.C. Ruling 1975-12 was first published on September 4, 1975. (40 F.R. 40828.)
Part III of Ruling 1975-12 purported to interpret the exemption from price control of crude oil produced from "stripper wells," provided in successive statutes and regulations of DOE and its predecessors FEA, Federal Energy Office (FEO) and Cost of Living Council (CLC). The statutory and regulatory history of the "stripper well" exemption, material to this appeal, is fully and accurately set forth in the original majority and dissenting opinions in Energy Reserves Group, Inc. v. Department of Energy (Em.App.1978) 589 F.2d 1082, explained in Duncan v. Theis (Em.App.1979) 613 F.2d 305.
The successive statutes and regulations described in the opinions in Energy Reserves Group, Inc. v. Department of Energy, supra, imposed an emergency mandatory system of allocation and control of prices of petroleum products from which crude oil produced from "stripper wells" was exempt. In § 4(e)(2)(A) of the Emergency Petroleum Allocation Act (EPAA), P.L. 93-159, 87 Stat. 627, effective in 1973, the statutory "stripper well" exemption was as follows:
The regulation promulgated under subsection (a) of this section shall not apply to the first sale of crude oil produced in the United States from any lease whose average daily production of crude oil for the preceding calendar year does not exceed ten barrels per well.
Regulations defining the stripper well exemption were promulgated successively by CLC and FEA. § 150.54(s), 6 C.F.R. (page 146) (1974) and § 210.32, 10 C.F.R. (page 98) (1976). The formula for determining "average daily production" as used in the statutes was consistently defined in the regulations of CLC and FEA as follows:
(b) Definitions: "Average daily production" means the qualified maximum total production of crude oil, including condensates, produced from a property, divided by a number equal to the number of days in the year times the number of wells that produced crude oil, including condensates, from that property in that year. To qualify as maximum total production, each well on the property must have been maintained at the maximum feasible rate of production, in accordance with recognized conservation practices, and not significantly curtailed by reason of mechanical failure or other disruption in production. (Emphasis added.) Energy Reserves Group, Inc. v. Department of Energy, supra, (Em.App.1978) 589 F.2d at 1091.
In 1975 FEA found it desirable to issue Ruling 1975-12, Part III, purporting to interpret the application of the regulations and underlying statute defining the stripper well exemption to multiple completion wells. Part III of Ruling 1975-12 is as follows:
Application of Part III of Ruling 1975-12 To "Commingled Wells"
The district court properly described the administrative application of Part III of Ruling 1975 12 to the problem created by claims of the plaintiff-appellee (appellee) on behalf of its members in the following parts of its Memorandum Opinion (Transcript Tr. 876 at pages 878-879):
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