A bankruptcy judge in Atlanta, GA, put the proceedings againstTitan Energy on hold yesterday after the gas marketer notified thecourt that AES Power Direct, a retail power provider, had made anoffer to purchase its assets.

AES Power, a subsidiary of AES Corp. in Arlington, VA, confirmedTuesday that it had expressed an interest in the troubled TitanEnergy, which filed for Chapter 11 bankruptcy on July 1, but noother details were available at press time. Judge W. Homer Drake ofthe U.S. Bankruptcy Court for the Northern District of Georgia inAtlanta has scheduled another hearing for next Tuesday to morethoroughly explore AES Power’s offer.

In the meantime, the efforts by two LDC subsidiaries of ColumbiaEnergy Group, whose customers were being served by Titan Energy, toobtain some relief from the court were postponed until next week.Titan participated in the customer-choice programs of Columbia Gasof Ohio Co. and Columbia Gas of Pennsylvania Co., serving a totalof about 100,000 customers. But it ceased service to its customersin the two markets on July 1.

The Ohio LDC wants the court to determine the status of Titan’scustomers in Ohio — whether they belong to Titan and can beauctioned off by it, or whether they should revert back to ColumbiaGas of Ohio in the wake of the bankruptcy, said spokesman SteveJablonski.

Columbia Gas of Ohio notified Titan that it was terminating themarketer from its customer-choice program on the very same day thatTitan filed for bankruptcy, which Jablonski said has “kind ofmuddied the waters.” The LDC has asked the court to rule on whichcame first — the bankruptcy filing or its termination notice. Ifthe court finds that the bankruptcy filing came first, as Titan isarguing, then “under the bankruptcy code that basically freezeseverything in place,” and Columbia Gas of Ohio won’t be able torecover the costs its has incurred by serving Titan’s customerssince July 1.

Jablonski estimated that Columbia Gas of Ohio has been payingabout $28,000 a day to supply Titan’s customers. As of July 1, themarketer stopped injecting gas into the LDC’s system, and ColumbiaGas of Ohio — as supplier of last resort — has had to shoulderthat responsibility, he said.

“I think it’s likely that the court will urge all the parties totry and get together and reach some sort of a resolution before itneeds to make a ruling,” Jablonski noted. “One likely option wouldbe a reassignment of [Titan’s] customers. We would not be opposedto discussing that with the other parties.”

Columbia Gas of Pennsylvania filed an emergency motion with thecourt seeking “adequate protection” of the money owed to it byTitan Energy. LDC spokesman Rob Boulware estimated that about$20,000 was owed by Titan as of July 1, and that it has beenincurring costs of about $9,000 per day because it has had to servethe marketer’s customers.

In the event Titan fails to either resolve its debts or auctionoff its customers to another marketer, the Pennsylvania customerswould then revert back to Columbia Gas of Pennsylvania, Boulwaresaid. Efforts to reach Titan Energy for comment were unsuccessful.The company’s telephone has been “temporarily disconnected.”

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