Maryland Governor Parris N. Glendening signed into law electricderegulation legislation and related tax bills. The legislationenables the Maryland Public Service Commission (PSC) to moveforward on the details of how the state’s power industry will bederegulated. “I am pleased that the legislature responded to myproposal to include a mandated rate reduction for Marylandresidential homeowners in the bill to protect consumers fromunintended rate increases,” Glendening said in an earlier statementregarding the bill. “Frankly, I wish the reduction was more than3%. I also wish that stronger environmental provisions had beenincluded. The General Assembly has strongly indicated, however,that they believe this proposal is the best that can beaccomplished, and this bill is too important for Maryland’s futureto hold up further.” The law will phase in residential customerchoice over a three-year period beginning with one-third ofresidential customers July 1, 2000. Residential customers choosingto keep their utility as supplier would get rate cuts between 3%and 7.5% to be determined by the PSC. The rate cuts would last fouryears and then rates would be deregulated. Six utilities serveMaryland, including Allegheny Power, Baltimore Gas and Electric,Conectiv, Potomac Electric Power, Choptank Electric Cooperative,and Southern Maryland Electric Cooperative.

UtiliCorp United said Thursday it plans to launch on Friday an$8/share cash tender offer for all outstanding shares of Aquila GasPipeline Corp. common stock that it does not already own. RecentlyUtiliCorp’s negotiations with a special committee of independentAquila directors did not result in an acquisition agreementcovering a previous proposal. Now it is going directly toshareholders. UtiliCorp already owns about 82% of Aquila. UtiliCorpsaid completion of the tender is subject to receiving enough sharesso that it owns at least 90% of the midstream business. Completionof the tender is not contingent upon financing or approval by theAquila board of directors or its committees. The offer will bescheduled to expire at least 20 business days.

Koch Midstream Services said it purchased the Plum Creektreatment plant and Plum Creek gathering facilities in East Texasfrom Pioneer Natural Resources and Pioneer Natural Gas. Theprocessing facilities can handle 80 MMcf/d of gas. The gatheringsystem includes both 12-inch diameter gathering lines and 16-inchdiameter residue pipelines. “These East Texas assets are a naturalfit for Koch Midstream, as they will further enhance our operatingcapabilities in the Pinnacle Reef area,” said John Gibson,president of Koch Midstream.

The U.S. Department of the Interior’s Minerals ManagementService (MMS) has scheduled Western Gulf of Mexico Sale 174 forAug. 25 in New Orleans. The sale encompasses 3,642 unleased blocks,about 19.81 million acres, in the western Gulf’s Outer ContinentalShelf Planning Area offshore Texas and in deeper waters offshoreLouisiana. The blocks are located from nine to 200 miles offshorein depths ranging from eight meters to more than 3,000 meters.There are 2,120 blocks in depths of 200 meters or more. This is thefourth sale in the western Gulf and the seventh sale overall inwhich blocks receiving bids in depths of 200 meters or more areeligible for consideration under provisions of the Deep-WaterRoyalty Relief Act. The sale offers blocks in depths less than 800meters for a minimum bid of $25 per acre. Blocks in depths of 800meters ore more must receive a minimum bid of $37.50 per acre. Theproposed notice of sale will be posted on the MMS web site atwww.mms.gov.

Louis Dreyfus Natural Gas Corp. announced a $20.5 millionoffshore acquisition and provided an update on drilling activityduring the first quarter. The Company has acquired additionalworking interests in three of its operated offshore properties:High Island 45, East Cameron 129, and South Marsh Island 133. Theacquired interests have current production levels totaling 17MMcf/d equivalent and add proved reserves of 21.4 Bcfe, of which90% are natural gas. During the first quarter of 1999, the companydrilled 48 wells in its Gulf Coast, Permian and Midcontinent coreregions. A total of 44 will be completed as producers.

©Copyright 1999 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.