NorthWestern Energy Corp. intends to focus on its regulated utility assets and building more power and natural gas transmission infrastructure in its Great Plains region, said CEO Michael Hanson during a recent second quarter earnings conference call.
For both the second quarter and the first six months of this year, Sioux Falls, ND-based NorthWestern increased its net income compared to the same periods last year — $9.5 million (24 cents/share) in the second quarter, compared with $2.4 million (6 cents) for the same period in 2007; and $33 million in net income for the first six months, compared with $21.6 million for that same period last year.
Hanson stressed that with all three ratings agencies placing the company at investment grade and with a final settlement completed on the last lingering litigation from its Chapter 11 bankruptcy four years ago, NorthWestern is focused on infrastructure upgrades, particularly in Montana, and becoming a “pure utility” operation.
NorthWestern has pending a $404 million sales agreement for its 30% interest in the Colstrip Unit 4 coal-fired generation facility in Montana to Bicent (Montana) Power Co., and a filing with the Montana Public Service Commission (PSC) to consider taking the generation plant interest into the rate base for NorthWestern’s distribution power utility operations in the state. If the Colstrip interest is rate based, the sales agreement is terminated with Bicent, Hanson said.
Hanson said NorthWestern has several other investments it wants to make in expanded gas and electric infrastructure, including three electric transmission line projects in and around Montana — a 500-kV transmission line from Colstrip, a 230-kV collection system in the center of Montana, and the 400-mile Montana to Idaho high-voltage line, Mountain States Transmission Intertie (MSTI).
Hanson said MSTI is a $200-250 million project that would come on line in 2013, but during the rest of this year detailed economic, engineering and logistical studies will be done on the utility’s preferred and two alternate routes. “We already had 639 MW of expressed interest on the project,” he said. “We’ll ultimately match the market interest to the project capacity of this project when construction begins.”
Noting that balancing services are becoming increasingly scarce and more costly in the region, NorthWestern is continuing to pursue its $200 million, 125-150 MW Mill Creek Generating Plant in Montana as a means of providing its own balancing services in the area. That project is slated to be completed by January 2011. Added wind generation coming on line and the fact that NorthWestern is currently dependent on the market for all regulation services are further driving the need for this project.
“We expect to file a complete proposal with the Montana PSC by mid-August this year,” Hanson said.
NorthWestern also is looking at adding natural gas transmission in South Dakota and Nebraska, Hanson said. The utility plans to spend up to $40 million during the next three years for several natural gas pipeline extension projects to accommodate new and expanding biofuel and ethanol production facilities in the region.
Â©Copyright 2008Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.
© 2021 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |