Electric Power news briefs, Aug. 14
Tengasco Inc. ... Huaneng Power International Inc. ... Questar Gas ... National Iranian Oil Co. ... South Jersey Gas ... Nicor Gas ... Duke Energy Field Services LLC ... Duke Energy Corp. ... Phillips Petroleum Co. ... Nicor Gas ... Royal Dutch/Shell Group ... Fitch IBCA ... El Paso Electric Co. ... AmerenEnergy Resources Co.
Tengasco Inc., Knoxville, Tenn., and its wholly owned subsidiary, Tengasco Pipeline Corp. have entered into a definitive agreement for financing the completion of TPC's 58-mile Swan Creek natural gas pipeline system, the company reported. Under terms of the financing, a number of individual investors are providing TPC a $5.6 million credit facility secured by the Swan Creek pipeline facility. TPC will use the facility to pay for construction and start-up costs associated with completing the second phase of system scheduled by by yearend. Tengasco expects to be selling its full capacity of natural gas by mid-2001. A sales level of 20 MMcfd will add an estimated $29 million/year of cash flow or $3.30/share, the company said.
Huaneng Power International Inc. said total generation for the first half of the year was 21.7 billion kw-hr, representing 54.7 % of 2000's planned generation, a 28.7% increase compared to the same period of 1999. Compared with the same period of 1999, the fuel cost/unit for power sold was lower by 3.95%. The company said the increase in total generation is mainly attributable to a significant increase in power demand in several regions due to the healthy growth of the national economy; the contribution from newly installed capacity at the Nantong and Fuzhou Phase II power plants, and other generating units of the company maintaining good stability and reliability.
The Utah Public Service Commission has approved a $13.5 million general rate increase for Questar Gas, a subsidiary of Questar Corp, the company reported. This change will raise the typical residential customer bill to $620/year from $611, Questar said. The PSC's order also provides for an 11% allowed rate of return on equity. About half of a customer's bill consists of general rates, or nongas costs, such as system maintenance and other expenses related to delivering gas to customers, including investor returns. The increase granted Monday addresses these costs.
TEHRAN�A large gas field named Homa has been discovered in the south Fars province of Iran, an official with the National Iranian Oil Co. (NIOC) reported here Sunday. NIOC Director for Exploration Affairs Seyed Mahmoud Mohaddes told the Iranian News Agency (IRNA) that the field possesses on-spot gas reserves of up to 6.7 tcf, plus 83 million bbl of NGL. He said the field is expected to yield 4.74 tcf of gas and 58 million bbl of NGL. Mohaddes estimated development cost at about 18 billion Iranian rials, while the output is valued at about $4.7 billion.
South Jersey Gas, a subsidiary of South Jersey Industries, Inc., Folsom, NJ, filed a petition Monday proposing a $65.2 million increase to its levelized gas adjustment clause (LGAC) with the New Jersey Board of Public Utilities. If approved, gas bills for residential customers will rise 19%/year or about $33/month during the winter. To help its customers receive faster relief from the temporary price spike, South Jersey Gas also filed a request to adjust its LGAC quarterly instead of annually.
Duke Energy Field Services LLC (DEFS) reported it will issue an aggregate of $1.7 billion of notes in three tranches. The offering is scheduled to close on Aug. 16. DEFS will issue $600 million of 7 1/2% notes due Aug. 16, 2005; $800 million of 7 7/8% notes due Aug. 16, 2010; $300 million of 8 1/8% notes due Aug. 16, 2030. The notes are redeemable in whole or in part at any time. Lead underwriters are Merrill Lynch & Co. and J.P. Morgan & Co. Duke Energy Field Services LLC was formed by combining the Duke Energy Corp. and Phillips Petroleum Co.'s natural gas gathering and processing businesses. Duke Energy owns about 70% of the joint venture and Phillips, about 30%.
Nicor Gas, a Nicor Inc. unit, Naperville, Ill., reported it has filed a request with the Illinois Commerce Commission to expand the company's voluntary program which offers customers a choice of natural gas suppliers. If approved, all customers�business and residential�will have the opportunity to choose a natural gas supplier other than Nicor Gas beginning in March 2001. Nicor Gas has asked the commission to allow the company to offer supplier choice to all customers. If approved, Nicor Gas' service territory will be the first in Illinois where all customers have a choice of their natural gas supplier. The commission is expected to rule on the filing in September. When enrollment for the initial program closed March 31, 2000, more than 122,000 customers had selected alternate natural gas suppliers, representing more than 22% of eligible residential customers and 37% of business customers,one of the largest programs of its kind in the Midwest.
The Royal Dutch/Shell Group of companies (Shell) said it will consolidate its worldwide energy trading operations under the name 'Shell Tradiing'. It will possess a global portfolio in crude oil, refined products, natural gas, electrical power, and chemicals. The business will be headed by Mike Warwick, currently president of Shell International Trading & Shipping Co. and executive vice-president of Shell Global Businesses. Beginning Jan. 1, 2001, the Shell Trading organization will include Shell's current trading platforms for crude and oil products worldwide; chemical feedstocks in Europe and the US; and natural gas and power in North America through Coral Energy and in Europe through Shell Energy. Shell's worldwide crude and oil products shipping operations and the marketing business of Coral Energy also will be included.
Fitch IBCA rated the $193 million of El Paso Electric Co. (EPE) unsecured pollution control bonds `BB+'. The bonds are being remarketed with a fixed term of 2 years without the letter of credit secured by first mortgage bonds, which had previously provided credit support to the bonds. The remarketing agent is Salomon Smith Barney. EPE's first mortgage bonds are affirmed at `BBB-'. The ratings reflect EPE's relatively predictable and healthy cash flow through 2005 resulting from the approval of a rate settlement agreement and passage of constructive electric restructuring legislation in 1999, an ongoing debt reduction program that continues to reduce leverage and interest expense, ongoing cost containment, and the resolution of litigation of the attempted municipalization by the city of Las Cruces. The ratings also consider EPE's high debt level and the company's significant concentration of nuclear generating assets, Fitch said.
AmerenEnergy Resources Co. reported some 630 Mw of new generation has became available this summer with the start up of 11 Illinois-based combustion turbine peaking units at three Illinois sites owned or controlled by the company. Power production began at the company's 172 Mw Pinckneyville site in June. At the company's 234 Mw Gibson City, Ill., site, two new combustion turbine generators began operating in June and August, respectively. Electric Energy Inc., a majority-owned affiliate, began operating five combustion turbine generators this summer, providing an additional 230 Mw of capacity.