Battle

The battle over the next gas distribution frontier is continuingin Maine with the Maine Public Utilities Commission (MPUC) grantingBangor Gas Co. unconditional authority to provide gas distributionservice to five municipalities in the greater Bangor area. BangorGas, a joint venture of Bangor Hydro and Energy Pacific, iscompeting for market share in the area with CMP Natural Gas, ajoint venture of Central Maine Power and New York State Electric& Gas. Both projects are intended to provide new gas serviceonce Maritimes and Northeast comes on line in November 1999.

UtiliCorp United and Andersen Consulting are engaged in a legalbattle over fees for work Andersen did for UtiliCorp that theclient says spiraled to more than twice the amount agreed upon.Most recently, UtiliCorp filed a $10 million suit in a Missouricourt charging Andersen with negligence and failure to live up toterms of a 1996 contract for administrative software and systems.The suit is a response to a complaint filed in March by Andersenseeking payment of fees UtiliCorp had withheld.

Frustrated by the pace of electric competition’s development inCalifornia, Enron has stepped out of the battle for residentialcustomers, at least for the time being. Enron blamed severalfactors for its decision. Consumer response has been disappointing,and state regulations put a crimp on the profitability of thebusiness.

The dueling U.S. titans were continuing their battle to be thenew owner of England’s The Energy Group. Texas Utilities said itacquired 36.9 million more Energy Group shares at 840 pence/share,representing about 7.1% of The Energy Group’s issued share capital,and now holds 114.4 million shares, about 21.96% of issued sharecapital. TU had the blessing of U.S. regulators for the shareacquisition.

The Alliance Pipeline project’s in-service date is expected tobe delayed by about one year, Alliance Pipeline President and CEODennis Cornelson announced yesterday. The massive Canadian gaspipeline project designed to bring 2.3 Bcf/d of supply to theChicago hub from supply basins in British Columbia and Albertalikely won’t start flowing gas until late in 2000 rather than inNovember 1999 because of continued regulatory delays in Canada. Theproject has come under a hail of protests from competitors inongoing hearings in front of Canada’s National Energy Board.

A bidding war has erupted over British electric company TheEnergy Group with Texas Utilities formally entering the battleMonday with an offer of 810 pence (US$13.37) for each Energy Groupshare – 45 pence more than that of the initial bidder PacifiCorp.The Portland, OR firm was not to be out-penced, however, coming inwith a new offer of 820 pence. PacifiCorp said it has acquired45,987,079 EG shares, representing approximately 8.8% of theBritish Firm’s outstanding share capital.