Higher prices and production, partially offset by merger costs,pushed third quarter earnings of Consolidated Natural Gas up 90% to$10.8 million, or 11 cents per share, from $5.7 million, or 6cents/share, a year earlier. Excluding costs related to the pendingmerger with Dominion Resources, Inc., of $7.7 million, or 6cents/share after taxes, income from continuing operations in thethird quarter of 1999 was $16.4 million, or 17 cents per share.

“We are on target to achieve our goal of a 25% increase inproduction in 1999,” said CEO George A. Davidson, Jr. Gasproduction during the quarter rose 25% (9.2 Bcf) to 45.8 Bcf (509MMcf/d). “In addition, income in our natural gas transmission andstorage segment rose 19% in the quarter.”

Pretax operating income for exploration and production was $34.8million in the third quarter of 1999, up from $18.1 million a yearearlier. The improved results were due to higher prices andincreased production of oil and natural gas from the Gulf ofMexico.

The average wellhead price for CNG’s gas production was $2.25 anMcf, up 20 cents from a year earlier. CNG’s average wellhead pricefor oil was $14.71 a barrel, up $3.45 from a year earlier.

The company’s four local gas utilities recorded a pretaxoperating loss of $23.3 million in the third quarter of 1999,compared to a loss of $20 million last year. A third-quarter lossfor this segment is considered normal since customers use less gasduring the summer months.

Throughput increased to 54.1 Bcf from 51.8 Bcf in 1998, but theeffect was more than offset by higher operating and maintenancecosts.

Pretax operating income for the company’s interstate natural gaspipeline and storage business was $36.1 million in the thirdquarter of 1999, up from $30.4 million a year earlier. The increasewas partly due to increased prices for natural gas by-products.

Transmission throughput in the 1999 third quarter was 109.2 Bcf,up from 104.5 Bcf a year earlier.

Davidson said the company expects to have all regulatoryapprovals for its merger with Dominion Resources by year-end.

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