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INGAA Downsizes Amid Bustling Merger Activity

INGAA Downsizes Amid Bustling Merger Activity

The stepped-up merger frenzy of gas pipeline companies has taken its toll on the Interstate Natural Gas Association of America (INGAA), which announced Friday it was downsizing its staff in response to its loss of members and dues.

"The energy industry --- particularly the pipeline segment --- is going through some upheaval, with mergers and consolidation, and competition coming at our members from all sides. So it's only natural that INGAA reflect that trend. Our member companies have downsized to cut costs, and so must we," said INGAA President Jerald V. Halvorsen.

Earlier this year, INGAA lost two members --- Kinder Morgan Inc., which purchased the financial troubled KN Energy; and Sempra Energy, parent of San Diego Gas and Electric and Southern California Gas. The losses are likely to be much heavier next year if El Paso Energy continues its current merger pace.

If all its deals go through, El Paso will either own or have interest in El Paso Natural Gas, Midwestern Gas Pipeline, Southern Natural Gas Pipeline, Mojave Pipeline, Tennessee Gas Pipeline, Florida Gas Transmission, Texas Intrastates, ANR Pipeline, Colorado Interstate Gas, Great Lakes Gas Transmission, Wyoming Interstate and the All American Pipeline. For INGAA, this means that instead of getting dues from each individual pipeline, it will be paid only one membership fee by El Paso Energy.

Sempra's and Kinder Morgan's departure from INGAA meant that about $505,000 less went into the trade group's coffers for 2000 --- $475,000 less from Kinder Morgan and $30,000 less from Sempra. INGAA member dues are based on a pipeline company's revenues, and are capped at $475,000.

The impact of El Paso's merger activity on the pipeline group's budget next year could be staggering. INGAA's budget for this year was estimated at $5.2 million. In early January, it reported it had 33 corporate members.

Departing from INGAA are John G. Ams, senior vice president for finance and administration; Anne V. Roland, vice president of communications and executive director of the INGAA Foundation; and Lynne M. Turschmann, office manager and meetings coordinator. Each of the three received a buyout package. Also leaving is Kashka Bateman, an administrative assistant for the INGAA Foundation. This leaves INGAA with 17 staff members.

Susan Parker

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