Badger Pipe Line Company - Page 7

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          removed pipe was taken to one of petitioner's storage facilities.           
          The pipe has not been reused and remains in inventory.                      
          Petitioner did not retire the removed pipe, nor did it remove the           
          undepreciated cost of that pipe from its books and records.  The            
          original 1968 pipe on either side of the newly installed 1991               
          pipe was unaffected by the Route 83 relocation.                             
               Prior to, during, and following the Route 83 relocation,               
          petitioner's pipeline complied with all existing regulatory                 
          requirements at the Route 83 location site.  The Route 83                   
          relocation was performed by petitioner solely to comply with its            
          contractual obligations under its permit from IDOT and in order             
          to continue the use of its pipeline in the ordinary and normal              
          course of its business; it was not performed in response to any             
          regulatory order, regulation, or other regulatory requirement of            
          IDOT or any other regulatory agency.  Relocation expenses such as           
          those incurred by petitioner are ordinary and necessary incidents           
          of petitioner's business, are commonly and ordinarily incurred in           
          the pipeline business, and are necessary to enable a pipeline to            
          operate in the normal course of business.                                   
               The Route 83 relocation was not performed as part of a                 
          general plan of rehabilitation or refurbishment.  It was not                
          intended to, and did not, adapt the pipeline to a new or                    
          different use.  It did not result in any change in use of                   
          petitioner's pipeline system.  Prior to, during, and following              

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Last modified: May 25, 2011