Stingray Pipeline Company, L.l.c. v. Federal Energy Regulatory Commission

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued October 18, 2024 Decided December 20, 2024
No. 23-1288
STINGRAY PIPELINE COMPANY, L.L.C.,
PETITIONER
v.
FEDERAL ENERGY REGULATORY COMMISSION,
RESPONDENT
On Petition for Review of Orders of the
Federal Energy Regulatory Commission
Shemin V. Proctor argued the cause for petitioner. With
her on the briefs were Kevin Erwin and Gia V. Cribbs.
Angela X. Gao, Attorney, Federal Energy Regulatory
Commission, argued the cause for respondent. With her on the
brief were Matthew R. Christiansen, General Counsel, and
Robert H. Solomon, Solicitor. John H. Shaner, Attorney,
entered an appearance.
Before: SRINIVASAN, Chief Judge, WILKINS and RAO,
Circuit Judges.
Opinion for the Court filed by Circuit Judge WILKINS.

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WILKINS, Circuit Judge: Before us is a Petition for
Review challenging an order issued by the Federal Energy
Regulatory Commission (“FERC” or “the Commission”),
which authorized abandonment of a pipeline operated by
Petitioner Stingray Pipeline Company LLC (“Stingray”),
subject to a condition. See Order Authorizing Abandonments
and Determining Jurisdictional Status of Facilities, Stingray
Pipeline Co., 183 FERC ¶ 61,201 (2023) (“Initial Order”);
Order Addressing Arguments Raised on Rehearing, Stingray
Pipeline Co., 185 FERC ¶ 61,171 (2023) (“Rehearing Order”).
Stingray operates a pipeline system subject to FERC’s
jurisdiction. As a public utility subject to a certificate of public
convenience and necessity, it is required to supply continuous
service to its constituents. Beginning in at least 2014, however,
a portion of the pipeline began declining in volume (or
“throughput”), diminishing revenues while costs remained
hefty. Faced with an unprofitable business, Stingray sought to
abandon its pipeline by, in relevant part, selling it to an entity
outside of FERC’s regulatory jurisdiction. Shortly after its
application was filed, disaster (literally) struck. A hurricane
damaged part of the pipeline, Segment 3394, causing an
outage. Stingray assured FERC that it was developing a plan
to restore service. Four years later, Segment 3394 remains
inoperative.
FERC largely granted the application to abandon the
pipeline, but imposed one condition: Stingray either had to
restore Segment 3394 to service or reach an agreement with the
sole firm shipper whose service was interrupted. On rehearing,
Stingray challenged the condition as unreasonable and
unsupported by the record. After FERC reaffirmed its order,
Stingray petitioned this Court for review. Jurisdiction is proper
under 15 U.S.C. § 717r(b). For the following reasons, we deny
the Petition for Review.

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I.
A.
“The Natural Gas Act (‘NGA’) gives FERC ‘exclusive
jurisdiction over the transportation and sale of natural gas in
interstate commerce for resale.’” Columbia Gulf Transmission
v. FERC, 106 F.4th 1220, 1225 (D.C. Cir. 2024) (quoting
Schneidewind v. ANR Pipeline Co., 485 U.S. 293, 300–01
(1988)). “Section 7(e) vests in the Commission control over
the conditions under which gas may be initially dedicated to
interstate use. . . . [O]nce so dedicated there can be no
withdrawal of that supply from continued interstate movement
without Commission approval.” Atl. Ref. Co. v. Pub. Serv.
Comm’n of State of N.Y., 360 U.S. 378, 389 (1959); see
California v. Southland Royalty Co., 436 U.S. 519, 526 (1978)
(“Th[e] issuance of a certificate of unlimited duration . . .
create[s] a federal obligation to serve the interstate market until
abandonment authorization ha[s] been obtained.”).
A company subject to FERC’s jurisdiction who seeks to
“abandon all or any portion of its facilities” must request
permission from the Commission. 15 U.S.C. § 717f(b); Sunray
Mid-Continent Oil Co. v. Fed. Power Comm’n, 364 U.S. 137,
141 (1960) (Section 7(b) of the Act “regulates the
abandonment by natural-gas companies of their facilities and
services subject to the jurisdiction of the Commission.”).
FERC may only permit abandonment upon a finding “that the
available supply of natural gas is depleted to the extent that the
continuance of service is unwarranted, or that the present or
future public convenience or necessity permit such
abandonment.” Sunray Mid-Continent Oil Co., 364 U.S. at
142. “The statutory necessity of prior Commission approval,

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with its underlying findings, cannot be escaped.” United Gas
Pipe Line Co. v. Fed. Power Comm’n, 385 U.S. 83, 89 (1966).
“The abandonment provision was one aspect of Congress’
scheme to protect natural gas consumers from exploitation[.]”
Consol. Edison Co. of New York v. FERC, 823 F.2d 630, 632
(D.C. Cir. 1987). “The Commission may therefore control
both the terms on which a service is provided to the interstate
market and the conditions on which it will cease[.]” Southland
Royalty Co., 436 U.S. at 524.
B.
Stingray operates a 287-mile interstate pipeline system
that transports natural gas offshore Louisiana and Texas. In
1974, the then-Federal Power Commission, now FERC,
granted Stingray a certificate of public convenience pursuant
to 15 U.S.C. § 717f(c). That provision requires a natural gas
company to apply for and receive a certificate of public
convenience and necessity issued by the Commission before it
may construct or extend any natural gas pipeline within
FERC’s jurisdiction. 15 U.S.C. § 717f(c)(1)(A).
On September 25, 2020, Stingray requested permission
from the Commission to abandon by sale part of its pipeline
network, known as the West Cameron Block 509 (“WC Block
509”) system. Its proposal sought to abandon the relevant
pipeline portion by sale to a non-jurisdictional entity, Triton.
That system contains a 30-inch pipeline segment known as
Segment 3394, which begins at WC Block 509 Platform A and
extends about 25 miles. Stingray sought abandonment because
it saw a pervasive trend of declining throughput on WC Block
509 between 2014 and 2020. Stingray alleges that the costs to
maintain WC Block 509 greatly exceed the revenues generated
from this segment. Stingray’s initial application sought a
shortened procedure pursuant to 18 C.F.R. §§ 385.801 &

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385.802, which bypasses a hearing before an Administrative
Law Judge, see id. § 157.7 (discussing abbreviated
abandonment applications).
Shortly thereafter, on October 9, 2020, a platform
upstream of Segment 3394 was damaged by Hurricane Delta.
Segment 3394 was also damaged. As a result, the segment was
taken out of service, which “shut in,” or blocked, gas
production for two upstream firms: Arena and ERT. On
December 14, 2020, Stingray amended its abandonment
application. The amendment sought to abandon in place
certain damaged portions of the pipeline (i.e., rendering them
permanently nonoperational) because they were no longer
viable candidates for abandonment by sale. The amended
application did not acknowledge the Segment 3394 outage. It
also reiterated Stingray’s prior request to proceed through a
shortened procedure, waiving the right to a hearing. A
coalition of exploration and production companies
(“Intervenors”) protested the amended application, arguing that
Stingray had not shown abandonment was in the public
convenience, necessity, or interest; alerting the Commission
that two shippers were shut in (i.e., without service); and
expressing concerns that Stingray would effectively abandon
in place Segment 3394 by ignoring the outage.
Stingray dismissed these concerns, clarifying that it did not
discuss Segment 3394 in the amended application “because
that segment has only been taken out of service temporarily and
Stingray is in the process of developing a plan to bring Segment
3394 back into service.” J.A. 180. It assured FERC that it
would “communicate its plan to bring Segment 3394 back into
service in the normal course.” J.A. 181. The Commission, in
response to these filings, requested “an update on the status of
Segment 3394,” specifically stating: “If the pipeline is
operational, provide the date it was put back into service and

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the firm and interruptible throughput . . . of each shipper since
that time. If the pipeline is not in service, explain why and the
anticipated in-service date.” J.A. 247. Stingray responded:
“Segment 3394 has not been put back into service. Stingray
continues to look at options to develop a plan to put the line
back in service. At this time, there is no anticipated in-service
date.” J.A. 251.
On June 15, 2023, FERC granted Stingray’s application
for an abandonment order. It concluded that Stingray had
shown that present or future public convenience or necessity
permitted abandonment, noting that “[t]he disinclination of
Stingray’s shippers to sign non-discounted contracts for firm
transportation service provides a reasonable basis under these
circumstances for projecting a lack of growing demand in the
future,” and thus refusing to “require Stingray to maintain and
operate facilities that are not needed to meet the relatively low
level of existing firm service obligations and for which there is
no demonstration of market demand.” J.A. 281. Briefly put,
because there was clear evidence of diminishing demand, there
was little to no public need for Stingray to continue to operate
its pipeline subject to FERC’s jurisdiction.
Abandonment, however, was premised on a condition.
Because “Stingray state[d] that it [did] not intend to abandon
Segment 3394 in place,” but it did not provide an “in-service
date” prior to abandonment by sale to a non-jurisdictional
entity, FERC required Stingray “to either put Segment 3394
back into service prior to abandonment[] or file a statement
with the Commission demonstrating ERT accepts Segment
3394 remaining out of service.” J.A. 287 (footnote omitted).
On July 17, 2023, Stingray timely sought rehearing of this
condition, arguing that Segment 3394 did not need to be
included in the amended application because it was only

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temporarily out of service and Stingray did not seek to abandon
it in place. For the first time, Stingray stated that restoring
Segment 3394 to service would cost $7–9 million. This
financial burden, it contended, was unjustified in light of the
minimal throughput on the system.
On August 17, 2023, the Commission issued a Notice of
Denial of Rehearing, and Stingray timely petitioned this Court
for review of that order on October 16, 2023. On December 8,
2023, the Commission published an order explaining the
reasons for its denial, over a dissent.
II.
“The Court reviews FERC orders and actions under the
Administrative Procedure Act’s arbitrary and capricious
standard.” Columbia Gulf Transmission, 106 F.4th at 1230
(citation omitted). “We will sustain the Commission’s decision
unless it is ‘arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law.’” B&J Oil & Gas v.
FERC, 353 F.3d 71, 75 (D.C. Cir. 2004) (quoting 5 U.S.C. §
706(2)(A)). “In making this determination, the court must
consider whether the decision was based on a consideration of
the relevant factors and whether there has been a clear error of
judgment. The court is not empowered to substitute its
judgment for that of the agency.” ExxonMobil Gas Mktg. Co.
v. FERC, 297 F.3d 1071, 1083 (D.C. Cir. 2002) (cleaned up).
The Court “defer[s] to the agency’s expertise so long as its
decision is supported by substantial evidence in the record and
reached by reasoned decisionmaking, including an
examination of the relevant data and a reasoned explanation
supported by a stated connection between the facts found and

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the choice made.” Turlock Irrigation Dist. v. FERC, 786 F.3d
18, 25 (D.C. Cir. 2015) (cleaned up).
“The finding of the Commission as to the facts, if
supported by substantial evidence, shall be conclusive.” 15
U.S.C. § 717r(b). “Under the substantial evidence test, the
evidence relied upon by the agency must be substantial in light
of the whole record.” La. Ass’n of Indep. Producers & Royalty
Owners v. FERC, 958 F.2d 1101, 1115 (D.C. Cir. 1992) (per
curiam). “[W]hen agency orders involve complex scientific or
technical questions, as here, we are particularly reluctant to
interfere with the agency’s reasoned judgments.” B&J Oil &
Gas, 353 F.3d at 76.
A.
The parties disaggregated the issues into whether the
condition was supported by substantial record evidence, was
consistent with agency precedent, and represented a reasonable
balance of competing factors. But these various arguments all
boil down to one basic question: Was FERC’s decision to
condition abandonment in this way arbitrary and capricious
based on the record before it? The answer is no.
As the party seeking abandonment, Stingray bore the
burden to establish that abandonment without condition was
consistent with the public convenience and necessity. As we
have summarized, Stingray was required to make “the factual
showing which will assure the Commission, charged with
protecting the public interest, that that interest will in no way

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be disserved.” Mich. Consol. Gas Co. v. Fed. Power Comm’n,
283 F.2d 204, 214 (D.C. Cir. 1960).
1.
Here, the Commission’s order imposing the challenged
condition was lawful as it reasonably balanced the evidence
before it, notably Stingray’s repeated representations that it had
no intention of abandoning Segment 3394 in place. FERC thus
acted reasonably in concluding that abandonment was not
consistent with the public convenience and necessity absent the
condition.
Stingray’s amended abandonment application asserted
that abandonment met the statutory requirements because its
proposal ensured continuity of service to all reliant shippers.
In response to concerns articulated by shippers and the
Commission, Stingray represented that Segment 3394 was only
temporarily out of service, and that it would be restored to
service in the normal course of business. In its Initial Order,
FERC expressly relied on Stingray’s consistent claim that it
would restore Segment 3394 to service, reasoning:
Stingray states that it does not intend to abandon
Segment 3394 in place; however, Segment 3394 is part
of the West Cameron 509 System and proposed to be
abandoned by sale to Triton. And while Triton may
continue to provide service for downstream producers,
there is currently no in-service date for Segment 3394.
Therefore, Stingray is required to either put Segment
3394 back into service prior to abandonment, or file a
statement with the Commission demonstrating ERT
accepts Segment 3394 remaining out of service.
J.A. 287 (footnotes omitted). At that point, Stingray had
presented no evidence that it was financially infeasible to

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repair Segment 3394. While Stingray questioned at oral
argument whether it received sufficient notice to require such
evidence, it overlooks that Intervenors and the Commission
had each requested clarity on Segment 3394’s restoration to
service, most recently just three months prior to the Initial
Decision. Stingray was thus clearly on notice that parties
opposing abandonment, as well as the Commission, were
considering the Segment 3394 outage. Moreover, had
Stingray not waived its rights to a hearing below, it would have
received additional notice in that proceeding of both
Intervenors’ and the Commission’s concerns regarding
Segment 3394.
On rehearing, Stingray for the first time acknowledged
that it sought to abandon Segment 3394 by sale without
restoring service. It asserted that it would be financially
burdensome for it to do so, asserting that costs to repair would
total between $7–9 million. That figure was not supported by
further evidence. Notably, Stingray did not submit any
evidence of the economic value of continued service through
Segment 3394 to the reliant firm shipper, ERT. Instead, it
merely presented evidence that ERT makes up a small portion
of Segment 3394’s overall potential throughput. Such data
speak to ERT’s value to Stingray, not Segment 3394’s value
to ERT or to the public generally. Nor did Stingray make any
attempt to explain why it could not comply with the alternative
to repair set forth by the agency, that is, by reaching an
agreement with ERT. And Stingray did not ask to re-open the
evidentiary record, as permitted where there are “changes in
conditions of fact or of law or by the public interest,” as here.
18 C.F.R. § 385.716(c). It merely asked that the condition be
removed. The record that Stingray presented to the agency on
rehearing thus did not meet its burden to establish that
unconditional abandonment was consistent with the public
interest. Tenn. Gas Pipeline Co. v. Fed. Power Comm’n, 487

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F.2d 1189, 1195 (D.C. Cir. 1973) (When faced with a claim
“the abandonment d[oes] not meet the ‘public interest’
standard[] unless conditioned on provision of additional
service,” “the burden to refute that claim rest[s] on . . . the
applicant for abandonment authority.”).
Based on the record before it, the Commission reasonably
concluded that its condition was justified because Stingray had
not shown that abandonment could be approved without the
condition. At no stage did Stingray develop a factual record
sufficient to allow FERC to find, as it must, that unconditional
abandonment was consistent with the public interest. Stingray
first failed to even acknowledge the Segment 3394 outage,
then submitted financial figures, which still would not allow
FERC to assess Stingray’s burden relative to harm to ERT or
to the public. In its Rehearing Order, FERC emphasized that
“[a]n applicant for abandonment under § 7(b) of the NGA has
the burden of making the factual showing which will assure
the Commission, charged with protecting the public interest,
that that interest will in no way be disserved.” J.A. 334
(cleaned up). It reasoned that, despite Stingray’s
representations regarding the expense of repair, Stingray had
not carried its burden in light of its prior representations that it
would restore service, particularly because it understood the
expense required but did not share it with FERC.
The Commission also highlighted Stingray’s non-
acknowledgment of the alternative portion of the condition,
inviting Stingray to “file a statement demonstrating that its
firm shipper, ERT, accepts Segment 3394 remaining out of
service.” J.A. 339. Stingray has not submitted such a
statement, nor has it (at any stage of proceedings) presented

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evidence that it has attempted to reach any agreement with
ERT.1 It has not met its burden.
2.
Stingray’s arguments to the contrary are unavailing. It
primarily asserts that the record is not adequate to support the
Commission’s condition. But, as FERC itself noted, “[t]his
argument improperly seeks to shift the burden of showing that
Stingray’s abandonment application is in the public
convenience or necessity” to those opposing abandonment
without condition. J.A. 337 & n.38 (“‘Abandonment may be
allowed only if the “public convenience or necessity permit.”
And the word “permit,” instead of “require,” does not shift the
burden to those opposing the application.’”) (quoting Mich.
Consol., 283 F.2d at 214). The proper inquiry is whether
Stingray has established that unconditional abandonment is
consistent with the public convenience or necessity. It has not.
First, the Commission did not improperly inflate harm to
ERT in imposing the condition, nor did it depart from prior
precedent. “The Commission’s public interest consideration
. . . does not prohibit abandonment if there is any harm to any
narrow interest. Rather, the Commission takes a broad view
in abandonment proceedings and evaluates abandonment
proposals against the benefits to the market as a whole.”
Kinetica Deepwater Express, 156 FERC ¶ 61,208, slip op., at
*3 (Sept. 22, 2016). Stingray contends that FERC’s treatment
1 Stingray has shown it can reach such agreements as to other
portions of the system. With respect to the Mainline Facilities,
Stingray volunteered in its amended application that because “the
proposed abandonment would eliminate” certain transportation
avenues for a firm shipper, Stingray would “reach an agreement with
[that shipper] to address the issue of . . . transportation service prior
to the proposed abandonment.” J.A. 288.

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of ERT as a typical firm shipper was inconsistent with its prior
precedent, because ERT’s low volume diminished the strength
of its interest, rendering it so “narrow” that it did not prohibit
abandonment.2
In its rehearing request, Stingray cited Trunkline Gas Co.,
145 FERC ¶ 61,108 (2013), to argue that ERT’s interest is
narrow. There, the Commission discussed declining
throughput, deeply-discounted rates, and stagnant open
seasons as indicative of an “apparent lack of interest by
existing and/or potential shippers in contracting for the
capacity that Trunkline propose[d] to abandon,” which
“detract[ed] from the general concerns . . . concerning the
negative impact of the abandonment on retail, commercial,
and industrial customers within Michigan.” Id. ¶ 61,573.
“Such a lack of interest in obtaining additional capacity on a
long-term basis, except at deeply discounted rates, suggest[ed]
a belief on the part of the market that alternatives to serve the
future needs of Michigan exist.” Id. But Trunkline is distinct
from this case because there, “Trunkline ha[d] demonstrated
that it will have sufficient capacity following the proposed
abandonment to meet its firm shippers’ current needs for gas
transportation service.” Id. The same was true in Kinetica,
2 Stingray has not forfeited this argument, as FERC suggests. While
“[n]o objection to the order of the Commission shall be considered
by the court unless such objection shall have been urged before the
Commission in the application for rehearing unless there is
reasonable ground for failure so to do,” 16 U.S.C. § 825l(b), Stingray
did present this argument below, see J.A. 316 (FERC “failed to
consider the record evidence specific to the single shipper.
Consistent with its precedent, the Commission has found that
abandonments are supported when shippers are not willing to obtain
firm capacity at maximum rates.”). Stingray has also clarified on
appeal that it does not challenge ERT’s designation as a firm shipper,
but rather bases its objection on the circumstances of ERT’s contract.

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156 FERC ¶ 61,208, at *3. Stingray has neither established
that it would supply continuity of service through Segment
3394, as it initially represented, nor has it adduced any
evidence as to the value of such service to ERT, see supra
Section II.A.1. Stingray failed to build a record from which
FERC could reach Stingray’s preferred conclusion that ERT’s
interest was “narrow.”
In Delfin, the Commission conditioned abandonment on
the entity’s agreement to make the stakeholder “financially
whole.” Delfin LNG, 160 FERC ¶ 61,130, slip op., at *15
(Sept. 28, 2017). Stingray tries to distinguish Delfin. It notes
that the make-whole condition in that case was justified by
evidence that abandonment would change the rates that the
stakeholder paid. Here, by contrast, Stingray cites the absence
of any evidence of financial impact to ERT. Stingray argues
that FERC did not compare the cost to Stingray of the
condition with the harm to the shipper of Segment 3394
remaining out of service. Thus, in Stingray’s view, FERC did
not justify the condition. Pet’r’s Opening Br. 38 (arguing that
FERC demonstrated “no attempt to justify the costs of placing
Segment 3394 in service based on the harm to the single
shipper”).
Stingray is correct that the Commission noted the absence
of affirmative evidence of harm presented by Intervenors. See
J.A. 287 n.96 (“Although Segment 3394 has been out of
service since late 2020, the Producer Coalition does not
provide any evidence to demonstrate the challenges Arena,
ERT, or any other producer has experienced due to the
outage.”). But Stingray did not put forth evidence sufficient
for FERC to engage in the balancing analysis it urges. The
Commission’s conclusion that Stingray bore the burden to
show the absence of harm was thus consistent with both the
statute and prior FERC precedent. See Gulf S. Pipeline Co.,

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154 FERC ¶ 61,219, slip op., at *12 (Mar. 17, 2016) (Where
the pipeline “fail[s] to satisfy its burden of demonstrating that
abandonment will not have a negative impact on its existing
firm customers, either economically or in terms of quality of
service,” FERC properly considers those interests.).
Second, the condition was not inconsistent with the
Commission’s findings. Stingray argues that the same
findings that FERC used to justify abandonment as consistent
with the public interest counsel against imposition of the
challenged condition. But, as the Commission clarified on
rehearing, while “certain benefits would attend
abandonment[,] . . . that does not undermine the Commission’s
determination that the condition at issue is appropriate to
render abandonment in the public convenience or necessity.”
J.A. 338. To the extent Stingray asserts that the conditional
abandonment is arbitrary and capricious because the whole
system’s abandonment hinges on a condition limited to one
segment, it offers no authority suggesting that such an exercise
of FERC’s discretion is unreasonable. The Commission
enjoys wide discretion in fashioning such orders. See infra
Section II.B (discussing FERC’s authority).
3.
Nothing in this decision should be read to endorse a
bright-line rule whereby discontinuity of service for any sole
firm shipper, irrespective of their particular circumstances,
would automatically bar unconditional abandonment. We do
not understand FERC’s decision to state a rule that
abandonment is never in the public interest if a firm shipper
loses service, no matter how high the burden to the pipeline or
how low the value of service to the shipper. And we recognize
that there may very well be cases where a potential shut-in is
not dispositive and unconditional abandonment would further

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the public interest even if firm service was interrupted. In
short, the interests of a firm shipper may not always be
coextensive with the public convenience and necessity.
Our ruling today does not wade into these waters, but
instead rests on the record that Stingray presented to the
agency, which did not adequately explain why unconditional
abandonment was consistent with the public convenience and
necessity. Because the record is underdeveloped, we do not
read the Commission’s orders as affirmatively finding that
unconditional abandonment would disservice the public
convenience and necessity. At oral argument, the Commission
acknowledged that Stingray is free to file a new abandonment
application that justifies its proposal to abandon Segment 3394
by sale to Triton without first restoring service. Perhaps
Stingray will build a more fulsome record and obtain the
abandonment order, without condition, that it seeks.
B.
We also reject Stingray’s arguments that the condition
was imposed in excess of FERC’s regulatory authority.
Congress conferred broad authority upon the Commission to
“perform any and all acts, and to prescribe, issue, make,
amend, and rescind such orders, rules, and regulations as it
may find necessary or appropriate to carry out the provisions
of this chapter.” 15 U.S.C. § 717o; see also United Gas Pipe
Line Co., 385 U.S. at 90 (same). The Supreme Court has
“consistently recognized that the Commission’s legal control
over the continuation of service is a fundamental component
of the regulatory scheme. To deprive the Commission of this
authority, even in limited circumstances, would conflict with
basic policies underlying the Act.” United Gas Pipe Line Co.
v. McCombs, 442 U.S. 529, 538 (1979) (cleaned up). Its
discretion encompasses, among other things, the timing of

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approval of abandonments. See Fed. Power Comm’n v. Moss,
424 U.S. 494, 500–02 (1976) (“In the absence of an explicit
direction, the inference may reasonably be made that Congress
left the timing of the finding within the general discretionary
power granted [to the Commission] ‘to regulate the
abandonment of service.’”) (quoting S. REP. NO. 75-1162, at 2
(1937)).
First, Stingray points to no authority supporting its
argument that the Commission’s conditioning authority is
limited to conditions proposed by the parties. One of the
reasons that Intervenors opposed abandonment in its entirety
was a concern that Segment 3394 would not be restored to
service prior to the abandonment order. And while Stingray
makes much of the distinctions between Intervenors’ request
that Stingray not abandon Segment 3394 in place and the
instant proceedings involving abandonment by sale, as the
Commission stated, this “places semantics over substance.”
J.A. 336. The thrust of Intervenors’ concern was clearly that
service would be shut in as a result of Segment 3394’s
inactivity, and Stingray does not explain why FERC could not
condition abandonment to mitigate that concern.
Natural Gas Pipeline Co. of America, 151 FERC ¶ 61,232
(2015), is not to the contrary. Stingray contends that in
Natural Gas, “the Commission recognized that where the
pipeline was in poor condition, there were three options: 1)
repair or replace; 2) abandonment in place, which ‘would
remove facilities from service that might be of use to other
market participants’; and 3) abandonment by sale to a third
party.” Pet’r’s Opening Br. 24–25 (quoting Natural Gas, 151
FERC ¶ 62,515). But that is not what Natural Gas said. In
that case, following damage to the pipeline, “[t]his situation
prompted Natural”—not FERC—“to evaluate various options
with regard to the future operation of Segment 1: (1) repair or

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replace Segment 1; (2) abandonment in place; or (3) sale to a
third party.” 151 FERC ¶ 62,515. The Commission granted
abandonment in full, noting that Natural had proposed a new
line to ensure continuity of service, id. ¶ 62,517 (“Natural
states that the proposed new line will be placed in service prior
to” disconnect, “thus providing shippers with continuity of
natural gas transportation service.”), and “the sole firm shipper
with a primary delivery point on Segment 1 . . . agreed to
terminate their firm transportation agreement,” id. FERC did
not make any statement in Natural Gas that abandonment by
sale to a non-jurisdictional third party, without first restoring
service where such restoration was promised, is proper.
Second, the Commission’s order does not seek to do
indirectly what it cannot do directly, that is, regulate a non-
jurisdictional entity. Stingray argues that FERC cannot
condition abandonment merely because it would not be able to
order the non-jurisdictional entity, Triton, to repair Segment
3394. In support, it cites National Fuel Gas Supply Corp. v.
FERC, 909 F.2d 1519, 1522 (D.C. Cir. 1990), for the
proposition that “[t]he Commission may not, however, when
it lacks the power to promote the public interest directly, do so
indirectly by attaching a condition to a certificate that is, in
unconditional form, already in the public convenience and
necessity,” Pet’r’s Opening Br. 48. But as the Commission
made clear in its Rehearing Order distinguishing National
Fuel, “Stingray’s abandonment application is in the public
interest only as conditioned to ensure that Stingray satisfies its
obligations to ERT as a firm shipper.” J.A. 342 (emphasis
added). Given the record before it, the Commission
reasonably concluded that it could approve abandonment only
if conditioned on Segment 3394 being repaired or ERT
consenting to the segment remaining out of service. See supra
Section II.A. Moreover, the Commission has “a regulatory
responsibility to assure that gas once dedicated to the interstate

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market will continue to be available to that market so long as
the public interest demands,” United Gas Pipe Line Co., 385
U.S. at 88 (quoting Cont’l Oil Co. v. United Gas Pipe Line
Co., 31 F.P.C. 1079, 1082 (1964)), and Stingray failed to
establish that unconditional abandonment was consistent with
the public convenience or necessity.3
The Commission’s conditional abandonment order did
not exceed its authority.
III.
For these reasons, we deny the Petition for Review.
So ordered.
3 Stingray asserts in passing that the condition impermissibly alters
its commercial relationships, but Section 7(b) “creates a continuing
regulatory obligation, irrespective of private contractual
arrangements, not to abandon any certificated obligations before
obtaining authorization from the Commission to do so.” Panhandle
E. Pipe Line Co. v. FERC, 803 F.2d 726, 728 (D.C. Cir. 1986);
McCombs, 442 U.S. at 538 (“To conclude otherwise . . . would
enable private parties to circumvent the Commission’s authority over
abandonments.”).

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