Colorado regulators have approved a settlement for Rapid City, SD-based Black Hills Corp.’s natural gas utility operations in the state, allowing a small rate increase amounting to less than 1% annually. Black Hills/Colorado Gas Utility Co. put the recommended rate hike into effect Monday, the first base rate increase for the utility since April 2009. Although the increase amounts to only $174,000 more in revenue annually, or an 0.83% increase, Black Hills officials said the approved rates allow it to recover the nearly $30 million the utility has invested in its infrastructure since 2008, along with a 9.6% return on equity. The increase was hammered out in a settlement earlier this year among the utility, Colorado Public Utilities Commission staff and the state Consumer Counsel Office.
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Black Hills CEO Sees Big Potential in Mancos Shale
Although it will take another year or more to fully assess the value, Rapid City, SD-based Black Hills Corp. is staking a lot of its long-term oil and natural gas value on its Mancos Shale acreage in both the Piceance and San Juan Basins, CEO David Emery said during a 3Q2012 earnings conference call Thursday.
Industry Brief
Rapid City, SD-based Black Hills Corp. closed a previously announced $243 million sale of approximately 85% of Bakken and Three Forks shale assets in the Williston Basin held by its Black Hills Exploration & Production Inc. (see Shale Daily, Aug. 27). The sale was effective July 1. CEO David Emery said the sale will allow the energy holding company to reduce its overall debt and fund growth projects. Black Hills also said it intends to redeem $225 million of senior unsecured 6.5% notes that were scheduled to mature May 15, 2013.
Black Hills Works Through Low Gas Prices, CEO Says
While it increased earnings slightly in 1Q2012 compared to 1Q2011, Rapid City, SD-based Black Hills Corp. had to overcome a 22% decrease in natural gas prices and a 13 cents/share negative impact on earnings from milder-than-normal winter weather, according to CEO David Emery.
Black Hills Colorado Coal-to-Gas Plan Scuttled
The Colorado utility operations of Rapid City, SD-based Black Hills Corp. has hit a state regulatory roadblock to replace old coal- and natural gas-fired generation plants with a single 88 MW gas-fired plant near Pueblo, CO.
Industry Brief
Rapid City, SD-based Black Hills Corp. has closed the sale of energy marketing unit Enserco Energy Inc. to Houston-based Twin Eagle Resource Management LLC for $160-170 million. Twin Eagle obtained Enserco’s North American-based natural gas, power, coal and crude oil marketing operations. Enserco operations include crude gathering and marketing assets averaging 30,000 b/d through 12 owned or leased terminals; natural gas marketing with 8 Bcf of leased storage and 250,000 MMBtu/d of firm transportation; power marketing serving municipal and retail load; coal marketing and 35,000 tons per day of physical coal deliveries; as well as rail transportation contracts. The deal was announced by Black Hills in January (see Daily GPI, Jan. 20).
North Dakota Eyes Funding for Shale Boom
Infrastructure, water and housing upgrades remain priorities in western North Dakota to keep up with the continuing robust growth in oil and gas development, according to a report released Tuesday by Gov. Jack Dalrymple.
Black Hills Sees Growth in E&P, Utilities
Despite spilling more red ink last year in its exploration and production (E&P) business, Rapid City, SD-based Black Hills Corp. expects growth in that part of its business, which now places more emphasis on the regulated utility sector in several states, according to CEO David Emery.
Black Hills Sells Energy Marketing Unit
Rapid City, SD-based Black Hills Corp. said Wednesday it is selling energy marketing unit Enserco Energy Inc. to Houston-based Twin Eagle Resource Management LLC for $160-170 million. The transaction is expected to close by the end of March.
Black Hills CEO Touts ’21st Century’ Utility Model
Billing its transformation away from coal-fired generation to more natural gas-fired power as a “21st Century model,” Rapid City, SD-based Black Hills Corp. said Wednesday its utility operations in Colorado would start the new year by firing up commercial operations of two new baseload gas-fired generation plants near the Pueblo, CO, airport.
