BP-Amoco Merger to Close Today

British Petroleum (BP) and Amoco Corp. said they will completetheir merger today after receiving Federal Trade Commission (FTC)approval yesterday for the $57 billion deal. To win FTC approval,the companies agreed to free up more than 1,600 gas stations in 30southeastern and midwestern markets and to divest nine petroleumterminals. The 4-0 vote in favor of the merger becomes final aftera 60-day comment period.

December 31, 1998

Moler Joins Vinson & Elkins Energy Practice

Elizabeth Anne “Betsy” Moler, former deputy secretary of theU.S. Department of Energy and chair of the Federal EnergyRegulatory Commission,is leaving the public sector for privatepractice at a major law firm.

November 16, 1998

Third Remand Affects Penalty Revenue

In another case the Federal Energy Regulatory Commission isgoing to have to defend its policy of not requiring pipelines toflow through penalty revenues, the U.S. Court of Appeals ruledFriday in remanding a case involving NorAm Gas Transmission (No.97-1607). The 2-1 decision in Amoco v. FERC, with Judge Randolphconcurring in part and dissenting in part, did not object toNorAm’s raising penalty rates, but it does ask for an explanationof why the Commission believes penalty revenues will be soinsignificant as to warrant no consideration. In the year prior toNorAm’s rate filing the pipeline had collected $1.8 million inpenalty revenue. The court noted FERC appeared to believe thatbecause penalty rates were raised, the incidence of penalties woulddecrease. But “even if a lesser number of penalties are imposed,the increased penalty rate might result in a gross increase inpenalty revenue. Moreover – and this is the key imponderable -whether a shipper will be willing to incur the penalty depends onhis cost in securing alternative supplies in a tight market.”

October 26, 1998

FERC Rejects Trailblazer Settlement Contested by Amoco

Amoco’s objections and its standing as a major customer ofTrailblazer Pipeline have made it impossible for the Federal EnergyRegulatory Commission to approve a settlement on new rates, FERCsaid in dumping the dilemma back in the lap of an administrativelaw judge.

October 19, 1998

Maritimes Lateral to Serve Generator

Maritimes & Northeast Pipeline recently filed an applicationwith the Federal Energy Regulatory Commission (FERC) to construct,own and operate a 1.1-mile, 12-inch diameter lateral pipeline toprovide gas service to the Maine Independence Station, currentlyunder construction in Veazie, ME. The Maine Independence Station isDuke Energy Power Services’ 520 MW gas-fueled generating station.

October 5, 1998

FTC Orders Shell/Tejas to Divest Gathering Lines

The Federal Trade Commission has issued a proposed consent orderrequiring Shell Oil subsidiaries Tejas Energy and Transok to divest171 miles of the 690 miles of natural gas gathering lines recentlyacquired from Coastal Corp. subsidiaries in Oklahoma and the TexasPanhandle.

October 5, 1998

Nationwide Search for FERC Leaders

Candidates to head up three main divisions of the Federal EnergyRegulatory Commission being created in the on-going FERC Firstrestructuring should have their applications in to the Commissionby Sept. 24, according to a government job notice being circulatednationwide. A salary between $106,412 and $125,900 comes with thedirectors’ positions for the Office of Markets, Tariffs and Rates,the Office of Strategy and Organization Management, and the Officeof Administrative Litigation.

September 8, 1998

FERC Approves Williams’ Park & Loan Service

The Federal Energy Regulatory Commission has conditionallyapproved a new interruptible park and loan service (PLS) to starttoday on Williams Gas Pipelines Central. The service – allowingcustomers to park or request a loan of gas at each of Williams’pools – was designed to give those customers greater flexibility ina market that has evolved from a monthly to a daily business. FERCapproved the service subject to refund and certain conditions.

September 4, 1998

Sempra Inks 10-Year Mexican Contract

Sempra Energy International was awarded a 10-year agreement byMexico’s Federal Electricity Commission (CFE) to supply gas to thePresidente Juarez power plant in Rosarito, Baja California. Semprawill provide a complete energy supply package to the plant,including delivery of up to 300 MMcf/d of gas, transportationservices in the United States and construction of a 23-milepipeline from the U.S.-Mexico boarder to the plant. The value ofthe 10-year gas supply contract could approach $1 billion incurrent dollars.

August 28, 1998

Despite Losses LG&E Supports Market

Burned so badly that it subsequently got out of the gas andelectric marketing business, LG&E Energy nevertheless has urgedthe Federal Energy Regulatory Commission not to interfere with theinfant electric market by imposing price caps. The marketer, whichhad been among the largest in the business, said the price run-upin June to the neighborhood of $7,000 per MWh for gas deliveredinto Cinergy was part of the “growing pains” of an immaturecommodities market.

August 11, 1998