April 23, 2004

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Application for Refund

Name of Firm: Firestone Tire and Rubber Co.

Date of Filing: August 13, 1991

Case Number: RF272-89581

This Decision and Order considers an Application for Refund filed by Firestone Tire & Rubber Co. (Firestone). (1) Firestone purchased refined petroleum products during the period August 19, 1973 through January 27, 1981 (refund period) and has requested a refund from crude oil monies available for disbursement by the Office of Hearings and Appeals of the Department of Energy pursuant to the Statement of Modified Restitutionary Policy In Crude Oil Cases, 51 Fed. Reg. 27899 (August 4, 1986). Firestone relies on the presumption of injury for end-users as the basis for its refund claim. Under this presumption, OHA will presume applicants were injured at the refund level of $0.0016 per gallon of product purchased if they were end-users of petroleum products and were not covered by the DOE or its predecessors’ price controls. City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987).

We have reviewed the substantial information submitted by Firestone and determined that it was an end-user of eligible petroleum products. The refund request is based on purchases of 1,592,031,025 gallons of butane, styrene, butadiene and petroleum waxes. Firestone derived these purchase figures by consulting actual business records and by using reasonable estimation techniques. After considering the Application carefully, we have concluded that a refund is warranted only for its butane purchases of 692,793,391 gallons.

As for the balance of the claimed purchases, butadiene, styrene and petroleum waxes, we find that the purchases do not qualify as eligible products - i.e., they are not products of the type on which we can find that Firestone incurred crude oil overcharges. In a July 25, 1992 Federal Register Notice (1992 Notice), we outlined the standard by which we would determine whether a petroleum product purchase was eligible for a refund. We stated:

we will presume that a claimant incurred a crude oil overcharge in the purchase of a product during the relevant period if either that product was named as a covered product in regulations promulgated pursuant to the EPAA or (a) was purchased from a crude oil refinery or (b) originated in a crude oil refinery and was purchased from a reseller who did not substantially change its form. . . .

57 Fed. Reg. 30731 at 30732 (July 25, 1992). (2) For the reasons stated below we find that Firestone’s purchases of butadiene, styrene and petroleum waxes are not eligible for a refund in the crude oil proceeding pursuant to the 1992 Notice. (3)

In order to establish that their purchases of butadiene originated from a refinery, Firestone has submitted descriptive information from various internet sites concerning the nature of the facilities where it purchased butadiene. See Firestone submission “Vendor Information Crude Oil Refineries” (February 9, 2004) (Vendor Information). However, after examining the information submitted to us, we find none of Firestone’s butadiene purchases are eligible for a refund in the crude oil proceeding. (4)

With regard to the Exxon (60,666,112 gallons) and Mobil (27,387,103 gallons) purchases, the internet narrative information submitted by Firestone indicates that the Exxon and Mobil butadiene was purchased not from a refinery but at chemical plants in Beaumont and Baytown, Texas. See Vendor Information (Exxon Mobil butadiene section at 5-6 (Baytown and Beaumont facilities)). Likewise, the Shell purchases (168,445,826 gallons) originated at a Shell chemical plant in Deer Park, Texas. See Vendor Information (Shell butadiene section at 3). According to the information submitted by Firestone, the Petro-Tex butadiene purchases (168,624,101 gallons) originated from, as far as we can tell, Petro-Tex’s butadiene processing facility, again not a refinery. Vendor Information (Petro-Tex butadiene section at 1). The Texas-US butadiene purchases (63,374,038 gallons) appear to have been made from at a butadiene plant operated in part by Texas-US Chemical Co. The internet historical narrative that Firestone submitted regarding the Texas-US facility at Port Neches, Texas states “[a] 100,000-ton butadiene plant built by the federal government at Port Neches . . . was sold to Goodrich-Gulf and Texas U.S. Chemical in 1955.” See Vendor Information (Texas-US butadiene section at 5).

While Firestone has also submitted Webster Directory Refinery classification codes for these facilities indicating that the functions of the facilities referenced above are “Oil Refining” or “Petroleum Refining” facilities, we have given more weight to the internet narrative descriptions which Firestone provided to us concerning the nature of the plants at which Firestone obtained the butadiene. In sum, we believe that for our purposes the plants from which the butadiene was purchased were petrochemical plants and not refineries and therefore, we are not able to approve any of Firestone’s claimed butadiene purchases for refund pursuant to the 1992 Notice. (5)

With regard to Firestone’s purchases of styrene we also find that the none of the styrene purchases are eligible for a refund. (6) The Shell purchases (8,858, 298 gallons) were made from a chemical plant, not a refinery, located next to a Shell refinery in Norco, Louisiana. Vendor Information (Shell styrene section at 6). The styrene purchases from the Suntide plant (57,358,348 gallons) were in actuality made from a styrene plant that Firestone itself created in partnership with another firm, Coastal Products Company. Vendor Information (Suntide styrene section - joint venture agreement at 1). Thus, the Suntide purchases were not purchased from a refinery. (7)

We also find that Firestone’s purchases of styrene from AMOCO (24,705,405 gallons) and AM/HOESCH (6,327,368 gallons) are not eligible for a refund. Firestone made the AMOCO purchases from a chemical plant operated by AMOCO adjacent to a refinery in Texas City, Texas. Vendor Information (AMOCO styrene section at 7). Likewise, the AM/HOESCH purchases were made from a chemical plant in St. James, Louisiana. Vendor Information (AM/HOESCH styrene section at 6).

As in the case of the butadiene purchases, Firestone has also submitted Webster Directory Refinery classification codes for the styrene facilities mentioned above indicating that the functions of the facilities referenced above are “Oil Refining” or “Petroleum Refining.” However, again we have given more weight to the internet narrative descriptions Firestone provided us concerning the nature of the plants at which Firestone obtained the styrene. Consequently, we find that the plants from which the styrene was purchased were petrochemical plants and not refineries. Therefore, we are not able to approve any of Firestone’s claimed styrene purchases for refund pursuant to the 1992 Notice. (8)

With regard to Firestone’s claim regarding petroleum waxes (8,412,413 gallons), there is no evidence in the record as to the where the waxes were purchased. Consequently, we find that Firestone’s purchases are not eligible for a crude oil refund under the standard articulated in the 1992 Notice.

As stated above, we will approve the remaining portion of the Applicant’s claim, its butane purchases. The total volume for the refund approved in this Decision is 692,723,391 gallons and the refund granted is $1,108,357 (692,723,391 gallons x $0.0016 per gallon). (9)

It Is Therefore Ordered That:

(1) The Application for Refund filed on behalf of Firestone Tire & Rubber Co., Case No. RF272-89581, is hereby approved as set forth in Paragraph (2) below.

(2) The Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller, of the Department of Energy shall take appropriate action to disburse the refund amount set forth in this Decision and Order from the DOE deposit fund escrow account maintained at the Department of the Treasury denominated Crude Tracking-Claimants IV, Account No. 999DOE010Z, to the applicant. A refund for $1,108,357 shall be transferred by wire transfer to Bridgestone Americas Holding, Inc., Firestone Tire & Rubber Co.’s successor in interest. Notification of the transfer should be sent to the following address:

Bridgestone Americas Holding, Inc.

c/o Glenn R. Haase, Esq.

General Counsel

535 Marriott Dr.

Nashville, TN 37214

(3) To facilitate the payment of a future refund, if the DOE should determine an additional payment is warranted, the applicant shall notify the Office of Hearings and Appeals in the event that there is a change in its address, or if an address correction is necessary. Such notification shall be sent to:

Office of Hearings and Appeals

HG-1/L’Enfant Plaza Building

U.S. Department of Energy

1000 Independence Avenue, S.W.

Washington, D.C. 20585-1615

(4) The determinations made in this Decision and Order are based upon the presumed validity of the statements and documentary material submitted by the applicant. This Decision and Order may be revoked or modified at any time upon a determination that the basis underlying the refund applications is incorrect.

(5) This is a final Order of the Department of Energy.

George B. Breznay

Director

Office of Hearings and Appeals

Date: April 23, 2004

(1)Firestone Tire and Rubber Co. merged with Bridgestone U.S.A. to form Bridgestone Americas Holding, Inc. which is the successor in interest to Firestone Tire and Rubber Co.

(2)A detailed explanation for this distinction is included in the Federal Register Notice at 30731-33.

(3)Butadiene, styrene and petroleum waxes were not covered products in the regulations promulgated under the Emergency Petroleum Allocation Act (EPAA) of 1973, 15 U.S.C. § 751, et seq.

(4)In its submission, Firestone stated that purchases of butadiene from ARCO (123,838,877 gallons), PR Olefin (100,604,210 gallons), FSTE-OR (29,228,428 gallons), and MITUSI (20,703,077 gallons) either were not purchased from a refinery or Firestone chose not to attempt to substantiate that the purchases were from a refinery. Hence, we do not find that Firestone incurred a crude oil overcharge with respect to these particular butadiene purchases. With regard to Firestone’s purchases from El Paso (30,385,782 gallons), there is insufficient information to conclude that butadiene was obtained directly from El Paso’s refinery in El Paso, Texas rather than a butadiene plant using butane as a raw material from the El Paso refinery. Consequently, we can not approve Firestone’s claim for the El Paso butadiene purchases.

(5)There is no indication in the record that any of the butadiene purchases were made from a reseller who did not substantially change its form. The purchases were all made directly from butadiene plants which created butadiene using various chemical process. See Vender Information (Schedule A-1) (summarizing raw material and process used to create butadiene in each facility).

(6)In its submissions Firestone stated that purchases of styrene from the following firms: Ashland (29,371 gallons), Dow (416, 892 gallons), COSNAR (2,473,675 gallons), Oixraine (527,602 gallons), Gulf (173,381 gallons), Monsanto (15,040 gallons) and Rexene (60,150 gallons) either were not purchased from a refinery or Firestone chose not to attempt to substantiate that the purchases were from a refinery. Consequently, we do not find that Firestone incurred a crude oil overcharge with respect to these particular styrene purchases.

(7)The agreement creating the Suntide styrene plant states “[t]he arrangement has been set up in a form that will satisfy two requirements: (1) that Firestone appear merely as a purchaser of styrene rather than a partner of Suntide in building and operating the styrene plant . . . .” Vendor Information (Suntide styrene section - joint venture agreement at 1). Given that, in reality, Firestone was a partner in the Suntide plant, it can not have experienced any overcharges from its purchases from that plant.

(8)There is no indication in the record that any of the styrene purchases were made from a reseller who did not substantially change its form. The purchases were all made directly from styrene plants which created styrene using various chemical process. See Vender Information (Schedule B-1) (summarizing raw material used to create styrene in each facility).

(9)The Applicant was granted an earlier crude oil refund for products not included in this decision. See Firestone Tire and Rubber Co., 21 DOE ¶ 85,396 (1991).