US regulator slams Dominion, Berkshire pipeline move
The US Federal Trade Commission said July 13 a gas pipeline deal now abandoned by Dominion Energy and Berkshire Hathaway should have never made it out of the boardroom.
Dominion Energy on July 12 said that it had terminated the sale of gas pipeline operator Questar Pipelines to Berkshire Hathaway Energy, citing antitrust issues.
Questar Pipeline, a division of Dominion, is a multi-state gas pipeline company with more than 4,000 km of pipe. Providing transportation and storage services, the company operates primarily in Utah, Wyoming and Colorado
In a statement, the FTC said the decision to abandon the sale keeps competition thriving, but it expressed frustration for having to expend considerable resources on the proposed transaction even after it filed a suit in 1995 to block the same arrangement.
“Given our prior action, and the even closer competition that developed between the pipelines since then, this is representative of the type of transaction that should not make it out of the boardroom,” Holly Vedova, the acting director of the bureau of competition at the FTC, said.
Vedova said her division would work to ensure similar issues are curtailed in the future.
The FTC said that only two pipelines deliver gas to the region and each is controlled by either Berkshire or Questar. Through the sale, it would have eliminated any market competition.
“This competition historically has enabled Utah customers to obtain lower transportation rates and better terms of service,” the FTC said.
Dominion said it terminated the agreement because of “uncertainty associated with achieving clearance” from the government under antitrust laws.
Dominion will now look to secure a 364-day loan to repay the roughly $1.3bn deposit made by Berkshire related to the acquisition.