PUC approves settlement on bi-directional flow of Laurel Pipeline

The Pennsylvania Public Utility Commission recently approved a July settlement between Houston-based Buckeye Partners, that operates the Laurel Pipeline, and a group of complainants.

The pipeline operates between Altoona and Pittsburgh and is used to move petroleum east-to-west from Philadelphia-area refineries. Buckeye Partners planned to initiate service in both directions.

The complainants opposed bi-directional service, maintaining gasoline manufactured on the East Coast is cheaper than Midwest gasoline for much of the year.

Two complainants, Giant Eagle and Sheetz, also claimed bi-directional service would hurt competition and cause higher gas prices and the closure of East Coast refiners.

Under the agreement, Buckeye Partners can begin to transport fuel west-to-east from Midwest refineries starting Oct. 1, but the agreement imposes a five-year moratorium on the extension of bi-directional service and a seven-year moratorium on flow reversal for any points east of Pittsburgh on the Laurel Pipeline.

The agreement also creates a system for resolving complaints.

“We appreciate the commission’s thoughtful review and timely approval of this settlement that ensures reliable access for Pennsylvania consumers to more affordable fuels on the Laurel Pipe Line,” Buckeye Partners said.

The start of bi-directional service is pending transportation service agreements between Buckeye Partners and some of its shippers.