A 62-mile pipeline that gathers raw natural gas in Weld County and transports it to processing facilities is not a public utility under state law, the Colorado Supreme Court ruled on Monday.

The justices heard the appeal of William C. Danks, who owns a farm in the county and filed his original complaint with the Public Utilities Commission. The core issue revolved around whether the state’s utility-regulating body holds jurisdiction over the line in question.

Danks asserted DCP Operating Company failed to obtain for its line a certificate of public convenience and necessity from the PUC pursuant to state law. The purpose of the regulation is to avoid duplication and competition between utilities, which are natural monopolies.

But after a series of decisions against Danks, the state’s highest court weighed in, agreeing that state law does not classify the gas-gathering “Grand Parkway” – as DCP’s pipeline in Weld County is known – as a public utility that the PUC can regulate.

“My sole interest is: Weld County, you’ve got an oil industry that’s a Fortune 500 company and you’ve taken advantage of the landowners out there that have no power against this monopoly,” Danks, who represented himself in the case, told the justices during oral arguments in April.

Danks also initiated previous litigation in response to oil and gas extraction, suing Weld County in 2019 with allegations that his property value would decline from DCP’s nearby industrial activity. His lawsuit at the time described an around-the-clock stream of trucks passing by his home, and accused the Weld County commissioners of violating the constitutional separation of powers in their approval of projects.

He then turned to the PUC and claimed the Grand Parkway and related smaller lines needed a certificate of public convenience and necessity. The law Danks relied upon defines public utilities to include pipelines “operating for the purpose of supplying the public.“

“These pipelines are operating for a public purpose of supplying the public with natural gas,” he contended.

However, the reality was more complicated. The Grand Parkway and related lines were “upstream” systems, collecting raw gas from individual wellheads and sending it primarily to DCP-operated facilities, which in turn remove impurities and convert the product into useable gas.

No consumers benefit from the upstream line, only from “downstream” distribution infrastructure. DCP has ownership of the vast majority of gas in the upstream line, and transports almost all of it to its own processing plants.

The PUC concluded the Grand Parkway, from wellhead to processing plant, is not a public utility. Consequently, it dismissed Danks’ complaint. At the same time, the commission advised its staff to investigate whether the downstream infrastructure implicated the PUC’s regulatory powers, and permitted Danks to raise future issues on that subject.

From there, Danks appealed to Denver District Court, where Judge A. Bruce Jones believed the PUC had reasonably handled Danks’ complaint.

“The line drawn here,” Jones wrote in a July 2021 order, “is sensible in that the PUC regulates and applies its expertise to the interactions of a company when ‘supplying the public,’ and not that same company’s dealings with vendors and others who provide raw resources.”

The Supreme Court, upon hearing the appeal, was confused by the PUC’s procedural move of dismissing Danks’ claim about the upstream line but weaving in unrelated details about the downstream infrastructure. The justices specifically asked the parties to be prepared to argue about the unusual position the PUC had taken.

Danks took issue with the request, insisting he should be able to submit his arguments in writing and repeating that his case was about “the rule of law.”

“This is a monopoly and they’re acting like a monopoly,” Danks asserted during oral arguments. He added that DCP was “exactly like Standard Oil,” the monopoly the U.S. government broke up in the early 1900s.

“Part of your argument might be that they’re not the traditional sale-side monopolist. They’re a monopsonist, which is the buyer-side transaction,” offered Justice Maria E. Berkenkotter.

However, the distinction was immaterial to the outcome. In a June 13 opinion, Justice Richard L. Gabriel chided the PUC for muddying Danks’ complaint with its segue into downstream pipelines but otherwise affirmed the prior determination that the upstream gas-gathering line is not a public utility.

“Danks’s concerns involving DCP’s purchase of raw gas are wholly unrelated to whether DCP’s gas-gathering system supplies the public, which is the sole issue before us today,” Gabriel wrote.

The case is Danks v. Colorado Public Utilities Commission et al.