ExxonMobil Corp. has selected mySAP.com as the primary backbonefor the company’s global business infrastructure project, accordingto the German firm, SAP AG, which bills itself as the world’sleading provider of inter-enterprise software solutions. The systemwill be designed to consolidate systems for the recently mergedExxon and Mobil companies, while improving business processes for100,000 employees worldwide. “We have been customers of SAP sincethe late 1980s, and we are excited to continue to build upon ourinvestment in SAP solutions to meet our business objectives ofmaintaining best-in-class business performance for our BusinessLines,” said Jerry Kohlenberger, president of the ExxonMobil GlobalServices Co. “By consolidating and upgrading all systems tomySAP.com, we will tighten synergies around the globe andstreamline business processes.”
PowerTrust.com, which announced last week that it was acquiringPerry Gas’ Southeastern States Energy, is currently awaiting a Georgiabankruptcy court’s decision on what will happen to the Georgia naturalgas marketer (see Daily GPI, Sept. 18). Perry Gas has accepted an offerof $4 million for its subsidiary. “PowerTrust’s intention is to honorthe fixed-price gas contracts that the customers already have,” saidChrista Donohue, spokesperson for PowerTrust. “We are going tocontinue those contracts, and shoot for as smooth of a transition aspossible for the customers.” PowerTrust is looking to transfermarketer certification from Southeastern States, and market in Georgiaunder PowerTrust.
Southern Union completed its merger with Valley Resources Inc.and expects to complete its other mergers with Providence Energyand Fall River Gas on Sept. 28. All three companies will form partof Southern Union’s New England division, which will include morethan 300,000 customers in Rhode Island and Massachusetts. Valleyshareholders will receive $25 cash for each share of ValleyResources common stock. Southern Union is an international energydistribution company serving 1.3 million customers in Texas,Missouri, Pennsylvania, Rhode Island, Florida, and Mexico. Itsnatural gas operating divisions include Southern Union Gas,Missouri Gas Energy, PG Energy, and Atlantic Utilities.
American Electric Power and the Lower Colorado River Authority(LCRA) have announced a partnership to construct a 150-mile portionof a proposed high-voltage power line in West Texas. The agreementcalls for AEP to manage construction of the line, perform localfield operations and maintain the line and related facilities. TheLCRA will handle the construction financing and will own theproject’s transmission assets. The 345-kilovolt power line willimprove the reliability of the Texas transmission system. It willbe able to move power from natural gas-fired power plants in thePermian Basin to other parts of the state to meet growing demandfor electricity. It also will serve as a major conduit of powerfrom wind power farms that have been constructed or are planned inWest Texas to meet the state’s renewable energy goals. The entireproposed line will stretch from Morgan Creek, east of Big Spring,to Comanche, southwest of Fort Worth. The proposed AEP/LCRA portionwill run 150 miles from the Mitchell County line to the BrownCounty line, at a cost of $90 million. All electric consumers whouse the power grid share the cost of the Texas transmission system.The Independent System Operator (ISO) of the Electric ReliabilityCouncil of Texas (ERCOT) has recommended the project. ERCOTrequires the proposed line’s new service by the summer of 2003.
Pioneer Natural Resources sold two million shares of PrizeEnergy Corp. for $40.6 million through a secondary offering.Proceeds will be used to retire bank debt. Pioneer retained 613,215shares of Prize common stock, or 4.9% of its outstanding shares.Pioneer will report a third quarter gain of $25.7 million on thesale of Prize shares.
Conectiv announced that it has ordered 21 combustion turbineunits from Siemens Westinghouse and General Electric as the nextstep in its aggressive strategy to establish a leading position inwhat it calls the “mid-merit” generation market within the PJMpower pool. Conectiv already owns 1,900 MWs of mid-merit andpeaking generation in PJM. The 21 new combustion turbines willallow the company to achieve its goal of adding up to 4,000 MW bythe end of 2004. The company said that it is in the final stages ofgetting the permits needed to begin construction of an additional550 MWs of combined cycle combustion turbine capacity at thecompany’s Hay Road power plant near Wilmington, DE. Conectiv hastaken the initial steps needed to begin developing a number of newpower plant sites within the PJM region, including brownfieldindustrial sites in Bethlehem, PA and Florence Township, NJ. Thesales of Conectiv’s fossil and nuclear power plants and thesecuritization of costs related to industry restructuring areexpected to net about $1 billion that will be used to help fund themid-merit strategy.
Remington Oil and Gas Corp., Dallas, TX, purchased the largesttract in a federal lease sale last week of properties east of theMississippi. Remington bought the rights to a 1,470 acre tract inLamar County, Mississippi. Thirteen parcels of federal land inKentucky and Mississippi brought $25,718 to the U.S. Treasurythrough the competitive auction of oil and gas leases conducted bythe U.S. Department of the Interior’s Bureau of Land Management(BLM). The sale was held in Springfield, VA by the bureau’s easternregion. Bonus bids, filing fees, and rental revenue totaled$32,250, of which $6,532 will be shared with the two states. Theagency offers selected parcels at quarterly competitive auctions.Regulations require the bidding to open at a $2 per acre minimum.All 13 parcels were sold at the minimum bid. Leases are awarded fora term of 10 years and as long thereafter as there is production inpaying quantities. Eighteen parcels remained available fornoncompetitive, next-day filing. Most of the parcels in lastweek’s bidding were in Mississippi.
Koch Industries is moving into the bandwidth business with theformation of Koch Global Bandwidth Services, a telecommunicationsbandwidth trading and optimization entity. “We’re excited about thepotential of this emerging opportunity, and believe we’re wellequipped to be a leading trader in this area,” said Sam Soliman,Koch Industries chief financial officer, who will oversee theoperation. “Koch’s experience in numerous trading arenas will bevery transferable to this rapidly growing market.” The unit will beheadquartered at Koch’s Houston office and will be led by BillMohl, previously a vice president with Altra Energy Technologies.Mohl also has served in several senior management roles with KochEnergy Trading and Koch Midstream over the last five years.
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