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Industry Briefs

Industry Briefs

Maryland Governor Parris N. Glendening signed into law electric deregulation legislation and related tax bills. The legislation enables the Maryland Public Service Commission (PSC) to move forward on the details of how the state's power industry will be deregulated. "I am pleased that the legislature responded to my proposal to include a mandated rate reduction for Maryland residential homeowners in the bill to protect consumers from unintended rate increases," Glendening said in an earlier statement regarding the bill. "Frankly, I wish the reduction was more than 3%. I also wish that stronger environmental provisions had been included. The General Assembly has strongly indicated, however, that they believe this proposal is the best that can be accomplished, and this bill is too important for Maryland's future to hold up further." The law will phase in residential customer choice over a three-year period beginning with one-third of residential customers July 1, 2000. Residential customers choosing to 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 four years and then rates would be deregulated. Six utilities serve Maryland, 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 Gas Pipeline Corp. common stock that it does not already own. Recently UtiliCorp's negotiations with a special committee of independent Aquila directors did not result in an acquisition agreement covering a previous proposal. Now it is going directly to shareholders. UtiliCorp already owns about 82% of Aquila. UtiliCorp said completion of the tender is subject to receiving enough shares so that it owns at least 90% of the midstream business. Completion of the tender is not contingent upon financing or approval by the Aquila board of directors or its committees. The offer will be scheduled to expire at least 20 business days.

Koch Midstream Services said it purchased the Plum Creek treatment plant and Plum Creek gathering facilities in East Texas from Pioneer Natural Resources and Pioneer Natural Gas. The processing facilities can handle 80 MMcf/d of gas. The gathering system includes both 12-inch diameter gathering lines and 16-inch diameter residue pipelines. "These East Texas assets are a natural fit for Koch Midstream, as they will further enhance our operating capabilities in the Pinnacle Reef area," said John Gibson, president of Koch Midstream.

The U.S. Department of the Interior's Minerals Management Service (MMS) has scheduled Western Gulf of Mexico Sale 174 for Aug. 25 in New Orleans. The sale encompasses 3,642 unleased blocks, about 19.81 million acres, in the western Gulf's Outer Continental Shelf Planning Area offshore Texas and in deeper waters offshore Louisiana. The blocks are located from nine to 200 miles offshore in 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 the fourth sale in the western Gulf and the seventh sale overall in which blocks receiving bids in depths of 200 meters or more are eligible for consideration under provisions of the Deep-Water Royalty Relief Act. The sale offers blocks in depths less than 800 meters for a minimum bid of $25 per acre. Blocks in depths of 800 meters ore more must receive a minimum bid of $37.50 per acre. The proposed notice of sale will be posted on the MMS web site at www.mms.gov.

Louis Dreyfus Natural Gas Corp. announced a $20.5 million offshore acquisition and provided an update on drilling activity during the first quarter. The Company has acquired additional working interests in three of its operated offshore properties: High Island 45, East Cameron 129, and South Marsh Island 133. The acquired interests have current production levels totaling 17 MMcf/d equivalent and add proved reserves of 21.4 Bcfe, of which 90% are natural gas. During the first quarter of 1999, the company drilled 48 wells in its Gulf Coast, Permian and Midcontinent core regions. A total of 44 will be completed as producers.

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ISSN © 2577-9877 | ISSN © 1532-1231
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