press release

Chevron U.S.A. Products Company and Navajo Refining Company Seek Overcharge Refunds

CHEVRON U.S.A. PRODUCTS COMPANY AND NAVAJO REFINING COMPANY SEEK OVERCHARGE REFUNDS FROM SANTA FE PACIFIC PIPELINE

SAN FRANCISCO, June 27, 1994 -- Chevron U.S.A. Products Company and Navajo Refining Company of Artesia, N.M., filed evidence Friday with the Federal Energy Regulatory Commission (FERC) supporting their claims that Santa Fe Pacific Pipeline, L.P. (SFPP) overcharged both companies for the transportation of petroleum products to Phoenix and Tucson, Ariz.

Chevron and Navajo collectively are seeking more than $15 million in refunds for shipments between 1990 and 1993. The two companies also want tariff rates reduced on future shipments. If FERC accepts the allegations and depending upon the date of a FERC final order, refunds of excess charges could be significantly higher.

In September 1992, Chevron filed a protest with FERC over SFPP rates and practices. Navajo joined Chevron in the protest in November 1993. Through the discovery process, experts hired by Chevron and Navajo analyzed SFPP cost of service records, which resulted in the evidence supporting the companies' claims that the pipeline company's rates are excessive.

SFPP operates two product pipeline systems, which transport products to Tucson and Phoenix. The East Line originates in El Paso, Texas, and the West Line originates in Los Angeles. Chevron and Navajo are challenging the rates for both systems.

Chevron and Navajo are asking FERC to reduce SFPP's current charges for transportation from El Paso to Tucson and Phoenix by approximately 40 to 50 percent.

The two companies are also asking FERC to reduce SFPP's current charges for transportation from Los Angeles to Phoenix and Tucson by approximately 20 to 30 percent.

Chevron and Navajo also are challenging SFPP's prorationing policy, which the companies believe is in violation of the Interstate Commerce Act.

Chevron U.S.A. Products Company is an operating unit of San Francisco-based Chevron Corporation. Navajo Refining Company is a subsidiary of Holly Corporation, which is headquartered in Dallas.

Updated: June 1994