The United States Bankruptcy Court in New York has approved the sale of two of Enron North America’s gas purchase agreements to Occidental Energy Marketing, Inc. (Oxy), which will assume responsibility for supply agreements with Peoples Energy utility subsidiaries The Peoples Gas Light and Coke Co. and North Shore Gas effective April 1.

A Peoples spokesman said the contracts run for two more years and include about 100 Bcf/year of gas supply for the Chicago marketplace. That represents about 50% of the supply requirements of Peoples and North Shore, she said. Oxy also will be managing the utilities’s other supply and pipeline capacity arrangements.

“We are pleased that these important gas supply agreements are with an energy supplier that has extensive experience with the Chicago marketplace as well as a strong credit position,” said Peoples Executive Vice President William Morrow. “Our utility customers will continue to receive highly reliable supply with no added cost.”

The court also approved Peoples Energy’s purchase of Enron’s 50% interest in Enovate LLC, a wholesale marketing partnership jointly owned by the two companies. Peoples Energy will continue to provide midstream services the Chicago regional marketplace independently while it evaluates new partnership opportunities with Occidental.

The court settlement also provides for assignment to Occidental of Enron’s interests in certain commodity and weather hedge positions.

“With the court’s action, Peoples Energy’s exposure under all its agreements with Enron has been effectively eliminated,” said Morrow.

©Copyright 2002 Intelligence Press Inc. Allrights reserved. The preceding news report may not be republishedor redistributed, in whole or in part, in any form, without priorwritten consent of Intelligence Press, Inc.