Companies

FERC said yesterday it has found Chicken Littles in the Y2Kplanning departments of several gas pipeline companies. TheCommission berated pipeline Y2K planners for crying “the sky isfalling” without any real good evidence that it is. To thosepipelines seeking a complete shut-down of multiple nominationperiods just prior to and after Jan. 1, FERC explained that so farthey have not provided convincing arguments why such drasticmethods would be required.

El Paso Energy Corp. and Sonat Inc. completed their $6 billionmerger yesterday. As NGI reported earlier, the two companies jumpedthe final hurdle when El Paso agreed to the FTC’s terms to divestits 100% ownership in East Tennessee Natural Gas Co., Sonat’s 100%ownership of Sea Robin Pipeline Co., and Sonat’s one-third interestin Destin Pipeline Co., L.L.C. following the merger (see Daily GPI,Oct. 25). The transaction creates a transmission system comprisingover 40,000 miles, which El Paso said is the largest system inNorth America both in terms of throughput and miles of pipeline.The new El Paso’s pipeline systems will transport 12.4 Bcf/d-fullyone quarter of the natural gas volumes transported in the UnitedStates. The combined company will be headquartered in Houston.Sonat’s headquarters will remain in Birmingham, AL, and El PasoNatural Gas Co. will remain in El Paso, TX. William Wise,previously CEO of El Paso Energy, will retain his position in thenew company. Ronald Kuehn, who has been CEO of Sonat, is now thechairman of the board for the combined company until Dec. 31, 2000.

Shareholders of Kinder Morgan, Inc. and KN Energy, Inc. approvedthe terms of the previously announced $925 million merger of thetwo companies. Ninety-eight percent of KN stockholders who voted onthe transaction approved a proposal to issue 41.5 million shares ofKN common stock pursuant to the terms of the merger agreement.Additionally, ninety-seven percent of KN shareholders votingapproved a proposal to amend the company’s articles ofincorporation to change the name of the company to Kinder Morgan,Inc. upon completion of the merger. Stockholders of Kinder Morgan,Inc., a privately held company, also approved the merger. RichKinder, chairman and CEO of Kinder Morgan and future CEO of thecombined company said the merger remains on track to be completedin early October. The planned merger will combine the generalpartner of the largest independent refined products pipelinecompany in the U.S. with one of the largest natural gas pipelineoperators.

ARCO and BP Amoco shareholders approved the proposed $27 billioncombination of the two companies last week, but the combinationremains subject to the approval of regulatory authorities,including the US Federal Trade Commission (FTC) and the EuropeanCommission. It’s expected to close later in the year. The all-sharedeal will involve the exchange of 0.82 BP Amoco American DepositoryShares (ADS) for each ARCO share.

Devon Energy Corp. and PennzEnergy Co. completed their merger,which was announced May 20. Shareholders of both companies approvedthe deal Tuesday. More than 99% of the shares represented at theDevon meeting were cast in favor of the merger. Of the sharesrepresented at the PennzEnergy meeting, about 92% were cast infavor of the merger.

Resistance to hedging has declined significantly amongindependent producers. But now that they’re hedging, some companiesare doing the wrong thing at the wrong time, according toexecutives at Statoil Energy.

EnergySouth Inc., a holding company for utility and storagecompanies in the Southeast, recently announced an expansion planfor the storage facilities of its subsidiary Bay Gas Storage Co.The plan calls for an additional salt cavern to be developed, whichwill increase the total working gas capacity of the site from 2.4Bcf to 6 Bcf. An open season will be held from July 15 until Aug.31 to help assess the final size and shape of the expansion.

EnergySouth Inc., a holding company for utility and storagecompanies in the Southeast, announced an expansion plan Friday forthe storage facilities of its subsidiary Bay Gas Storage Co. Theplan calls for an additional salt cavern to be developed, whichwill increase the total working gas capacity of the site from 2.4Bcf to 6 Bcf. An open season will be held from July 15 until Aug.31 to help assess the final size and shape of the expansion.

Shareholders of North Carolina Natural Gas Corp. (NCNG) approvedthe company’s acquisition by Raleigh, NC-based Carolina Power &Light. The companies are awaiting approval by the North CarolinaUtilities Commission and the South Carolina Public ServiceCommission. CP&L anticipates commission approval and completionof the acquisition in July.