Briefs

Houston-based Anadarko Petroleum Corp. announced a common stockoffering of 6.25 million shares. Proceeds of about $240.6 millionbefore expenses are to be used for general purposes, including U.S.gas and oil projects. The offering is Anadarko’s first since it wasspun off from Panhandle Eastern Pipe Line in 1986. Moody’sInvestors Service changed its rating outlook for Anadarko’s fixedincome securities to stable from negative based on increasingproduction, reserve replacement at reasonable finding costs, aswell as the common equity issuance. Anadarko has replaced more than200% of production for the past five years and in 1998 replacedmore than 500% of production at finding costs below most of theindustry, Moody’s said. The addition of mainly gas reserves lastyear lowered oil reserves to about 53% of the total.

Tennessee Gas Pipeline has asked FERC to declare five lateralsin Texas as non-jurisdictional gathering and allow it to abandonand sell them to affiliate El Paso Field Services. The WestMagnolia, Chesterville, Bay City, Hungerford, and Village MillsLateral Systems fit the description of gathering, Tennessee said,adding that they currently are little used. The pipeline said it isno longer necessary for it to own the gathering lines since it nolonger sells bundled gas services. Detaching them from theTennessee system will “improve Tennessee’s ability to streamlineits mainline transmission operations.” Also the systems would bebetter able to compete with other unregulated gathering services ifthey are not tied to a jurisdictional pipeline.

Shell Energy Services LLC is offering Georgia retail customers aweatherproof bill for their gas purchases. The bill sets flatmonthly charges for consumers’ natural gas bills, which Shellguarantees for a full 12 months. The program is different fromother “budget” billing plans, Shell said, because there is noyear-end adjustment or “true-up,” no matter how cold it gets in thewinter. For a limited time, consumers may sign up for the ShellEnergy WeatherProof(SM) Bill by calling 1-877-56-SHELL or byvisiting the Shell Energy Web site at www.shellenergy.com. Afterthey provide qualifying information, customers are told exactly howmuch their monthly natural gas bill will be for the next 12 months.The calculation is based on a computer program analysis ofmulti-decade weather patterns for their respective regions ofGeorgia. The analysis is combined with the 12-month historicalnatural gas usage at the consumer’s residence and the then-currentguaranteed rate per therm-now 39 cents for Shell Energy naturalgas.

The New York State Public Service Commission (NYPSC) approvedthe merger of Consolidated Edison of New York and Orange andRockland Utilities. NYPSC Chairman Maureen O. Helmer said Consumerswill benefit from the strength of the companies’ combinedmanagement and from merger-related savings over the next fiveyears.

A partnership between Sempra Energy International and PublicService Enterprise Group (PSEG) won approval from the board ofdirectors for Chilquinta S.A. to buy Chilquinta Energia, for $830million, Chilquinta announced Tuesday. Chilquinta Energia isChile’s third-largest electricity supplier, serving 405,000customers. Along with Chilean electricity supply, the Sempra – PSEGpartnership would acquire Energas, a Chilean natural gasdistribution company. Energas began service in May of 1998 andplans to reach 50,000 customers by 2003. Both Sempra and PSEG saidthe deal will progress their Latin America growth strategies andlook forward to entering into the Chilean electric market, whichhas grown 8% each year since 1991, compared to 1%-2% in the U.S.The deal is contingent on the buyers’ review and approval ofschedules for the definitive stock purchase agreement. Both Sempraand PSEG expect the purchase to be accretive in 1999. The $830million would net 90% of Chilquinta Energia’s stock for thepartnership. Upon final acquisition, Sempra and PSEG will be ableto make a tender offer to acquire the remaining 10 percent ofChilquinta Energia shares from other shareholders.

Maryland Governor Parris N. Glendening signed into law electricderegulation legislation and related tax bills. The legislationenables the Maryland Public Service Commission (PSC) to moveforward on the details of how the state’s power industry will bederegulated. “I am pleased that the legislature responded to myproposal to include a mandated rate reduction for Marylandresidential homeowners in the bill to protect consumers fromunintended rate increases,” Glendening said in an earlier statementregarding the bill. “Frankly, I wish the reduction was more than3%. I also wish that stronger environmental provisions had beenincluded. The General Assembly has strongly indicated, however,that they believe this proposal is the best that can beaccomplished, and this bill is too important for Maryland’s futureto hold up further.” The law will phase in residential customerchoice over a three-year period beginning with one-third ofresidential customers July 1, 2000. Residential customers choosingto keep their utility as supplier would get rate cuts between 3%and 7.5% to be determined by the PSC. The rate cuts would last fouryears and then rates would be deregulated. Six utilities serveMaryland, including Allegheny Power, Baltimore Gas and Electric,Conectiv, Potomac Electric Power, Choptank Electric Cooperative,and Southern Maryland Electric Cooperative.

TransCanada PipeLines subsidiary NOVA Gas Transmission (NGTL)filed its new pricing structure proposal with the Alberta Energyand Utilities Board (AEUB) yesterday. The gas transportation tollson TransCanada’s Alberta system are consistent with the memorandumof understanding (MOU) reached recently with the CanadianAssociation of Petroleum Producers. Announced March 24, the MOUdetails a new distance- and quantity-based pricing structure toreplace the current postage-stamp pricing regime for tolls on theAlberta system. The application also reflects input gathered duringan extensive stakeholder consultation process that began in late1996. The filing replaces an application NGTL put forth to the AEUBin April 1998.

Semco Energy bought Iowa Pipelines Associates (IPA) for anundisclosed amount Monday, in the company’s initial move tostrengthen its gas construction services after exiting the gasmarketing business. IPA will continue to operate with its own name under the Semco Energy Ventures section of the company. Semco saidthe deal should close sometime this week. “By acquiring IowaPipeline Associates, we have expanded our capacity to providequality engineering and construction services for an ever-wideningcustomer base,” said William Johnson, Semco Energy’s CEO. Semcorevealed its strategy last month, when it sold its gas marketingassets to CoEnergy, an MCN affiliate, for an undisclosed amount.Johnson, said the sale allowed the company to concentrate onbecoming “one of the largest providers of underground engineeringand construction services in North America.” IPA builds undergroundnatural gas pipelines and local gas distribution networks forcustomers in Iowa, Kansas, Missouri, and Nebraska.

Consolidated Edison and Orange and Rockland Utilities passed amilestone on their way to merging with approval of the transactionFriday by the New York Public Service Commission (NYPSC). Themerger also has been approved by the New Jersey and Pennsylvaniaregulators and FERC. Con Ed plans to acquire all O&R’s commonstock for $58.50 per share, or about $790 million. O&R willbecome a wholly-owned subsidiary of Consolidated Edison and willcontinue to operate as a separate company. The utilities areawaiting the approval of the Securities and Exchange Commission andcompletion of the Hart-Scott-Rodino Act review by the U.S.Department of Justice and expect to close the transaction by nextmonth.