Pacific

Transportation Notes

Northern Natural Gas said it lifted a System Underrun Limitationthat had been posted for Tuesday and today.

July 7, 1999

Transportation Note

After beginning last week in the middle of a three-dayhigh-inventory OFO (see Daily GPI, June 22), Pacific Gas &Electric declared another one for Saturday after previously sayingit expected system linepack to remain well above the utility’starget through the weekend. The new order carried a positiveimbalance tolerance of 11% and penalties of $1/dth fornon-compliance.

June 28, 1999

Transportation Notes

A high-inventory Stage 1 OFO implemented Sunday by Pacific Gas& Electric was continued through Monday and today. Sunday’s 15%imbalance tolerance was reduced to 6% Monday, but the noncompliancepenalty remains at $1/dth. PG&E projected that its linepackinventory would continue to be 200 MMcf or more above the utility’starget through Thursday.

June 22, 1999

PG&E Seeks Additional Summer Power from IPPs

Pacific Gas and Electric Co. and California’s independent powerproducers with qualifying facility (QF) contracts have cut a dealto free up excess power from the merchant generators to help handledemand spikes anticipated during this summer’s heat waves. TheCalifornia Independent Energy Producers (IEP) expect to have anadvice letter filing with state regulators by the end or April tofree up as much as 1,000 MW of power in the summer. Thin ancillaryservices supplies last summer caused record price spikes.

April 22, 1999

FERC Okays Merger of Western Utilities

FERC yesterday readily approved the $4 billion merger of twowestern utilities-Sierra Pacific Power and Nevada Power. This was”relatively easy” compared to other deals that have come before theCommission, said Commissioner Vicky Bailey.

April 15, 1999

Transportation Notes

Pacific Gas & Electric issued a low-inventory Stage 1 OFOfor today carrying penalties of $1/dth for negative imbalancesexceeding 5% of scheduled volumes.

April 7, 1999

PG&E Expects to Begin New Spending Spree

Following its reorganization of semi-autonomous PacificNorthwest and Texas gas assets, PG&E Gas Transmission (PG&EGT) is looking to bolster earnings through alliances andacquisitions that it hopes to complete later this year, accordingto Thomas King, president/COO of the Houston-based unit of PG&ECorp. PG&E GT transports an average of 6 Bcf/d through the tworegions.

March 9, 1999

PG&E Files Electric Rate Cutting Plan

Pacific Gas and Electric applied to the California PublicUtilities Commission (CPUC) to reduce electric rates at the end ofthe electric rate freeze, but no later than March 31, 2002. Thestate law that governs the restructuring of California’selectricity market, AB 1890, gave residential and small businesscustomers a 10% rate reduction on Jan. 1, 1998 and froze rates atthat level. The state law also provided investor-owned utilities atransition period to recover stranded costs. That transition periodends March 31, 2002, or when the past investment costs have beenrecovered, whichever comes first. At that time, the rate reductionswill go into effect.

March 8, 1999

Hydro Spin-Down May Threaten CA Power Projects

Bold plans by Southern California Edison and Pacific Gas andElectric Co. to transfer $2 billion in hydroelectric powergeneration assets to non-utility affiliates could threaten thecompetitiveness and profitability of the state’s emerging merchantpower business if allowed by state regulators. The proposals havesparked calls for a statewide investigation by the CaliforniaPublic Utilities Commission. Potential violations of market powerand utility affiliate transaction rules are being loudly raised bya growing number of opponents.

January 28, 1999

UPR Takes Write-Down For Low Prices

Union Pacific Resources Group Inc. said it will take a whopping$760 million after-tax, non-cash charge to fourth quarter earningsfor asset impairment under Financial Accounting Standard 121. UPRalso said its 1999 plans include continuing its cost-reductionprogram and a preliminary capital budget of about $500 million.Excess cash flow of more than $250 million will be used to furthercut debt to keep the company’s $2 billion de-leveraging program ontarget.

January 14, 1999