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Industry Briefs

Industry Briefs

A partnership between Sempra Energy International and Public Service Enterprise Group (PSEG) won approval from the board of directors for Chilquinta S.A. to buy Chilquinta Energia, for $830 million, Chilquinta announced Tuesday. Chilquinta Energia is Chile's third-largest electricity supplier, serving 405,000 customers. Along with Chilean electricity supply, the Sempra - PSEG partnership would acquire Energas, a Chilean natural gas distribution company. Energas began service in May of 1998 and plans to reach 50,000 customers by 2003. Both Sempra and PSEG said the deal will progress their Latin America growth strategies and look forward to entering into the Chilean electric market, which has grown 8% each year since 1991, compared to 1%-2% in the U.S. The deal is contingent on the buyers' review and approval of schedules for the definitive stock purchase agreement. Both Sempra and PSEG expect the purchase to be accretive in 1999. The $830 million would net 90% of Chilquinta Energia's stock for the partnership. Upon final acquisition, Sempra and PSEG will be able to make a tender offer to acquire the remaining 10 percent of Chilquinta Energia shares from other shareholders.

The government of Atlantic County, NJ, home of Atlantic City, NJ, announced Tuesday it awarded South Jersey Energy Co., a South Jersey Industries subsidiary, a two-year natural gas supply contract. South Jersey will supply the county's office buildings, schools, municipal buildings and housing authorities with gas at rates that will produce 20% savings over traditional utility-based rates. The contract, valued at $1.9 million, takes effect May, 1. South Jersey Energy did not release how much gas the county uses each year but it did say the contract covers one of the LDC's largest and fastest growing service areas.

Beating the estimated production date by four months, Shell Exploration announced the first well of the Ursa project is now producing 13,000 Boe/d and 20 MMcf/d. Once all 14 wells are operational, Shell said initial production could reach 80 MMcf/d.

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