Southern Union Co. last Monday reported a smaller net loss for the fourth quarter compared to the year-earlier period due to the successful integration of Panhandle Energy, which it acquired for $1.8 billion in mid-2003.

For the three-month period ended June 30, the Wilkes-Barre, PA-based energy company said it recorded a net loss of $398,000, or $0.01 per average common share, against a net loss of $10.6 million, or $0.18 per average common share, during the fourth quarter of 2003.

Southern Union said it typically has posted a large fourth-quarter loss due to the seasonal nature of its natural gas distribution business. But it expects that its acquisition of Panhandle Energy, with its less-seasonal transmission and liquefied natural gas (LNG) businesses, will enable the company to achieve improved fourth quarter results in the future.

For fiscal 2004, Southern Union reported record net earnings of $101.3 million, or $1.37 a share, compared with $76.2 million, or $1.29 a share, for the prior year.

The favorable fourth-quarter results “confirm the successful integration of Panhandle Energy,” said President and COO Thomas F. Karam. “We are on the threshold of unprecedented growth through our expansion at Trunkline LNG, our pending rate case at Missouri Gas Energy and our potential acquisition of [the] CrossCountry Energy” transmission assets from Enron Corp.

If it is the winning bidder at the Sept. 1 auction for the Enron assets, CCE Holdings LLC, a joint venture of Southern Union and GE Commercial Finance Energy Financial Services, expects to close the acquisition by mid-December of this year, Southern Union said. CCE Holdings has offered $2.35 billion for the CrossCountry transmission assets, which makes it the benchmark bid heading into the auction, the company noted.

Rival bidder NuCoastal LLC has offered $2.2 billion for the Enron pipelines.

Houston-based CrossCountry’s pipeline assets include: Transwestern Pipeline; Citrus Corp., a joint venture of Enron and Southern Natural Gas, which owns Florida Gas Transmission; and Northern Plains Natural Gas, one of the general partners of Northern Border Partners LP, which owns Northern Border Pipeline, Midwestern Gas Transmission, Viking Gas Transmission and Guardian Pipeline LLC.

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