Structure

The biggest challenges facing El Paso Corp. in 2005 will be hitting a $2 billion debt reduction target, getting its cost structure under control after more than $4 billion in asset sales over the last couple of years and turning around its exploration and production (E&P) business, CEO Doug L. Foshee told analysts at the UBS 2005 Natural Gas and Electric Utilities Conference on Wednesday.

TransCanada has reached a settlement agreement with its shippers on its 2005 Canadian mainline transportation toll structure. The new tolls, which still must be filed at the National Energy Board (NEB) and approved, contain no major surprises. They include a similar level of operation and maintenance expenses and depreciation costs as in 2004, and a 9.56% return on equity — as set by the NEB.

The biggest challenges facing El Paso Corp. in 2005 will be hitting a $2 billion debt reduction target, getting its cost structure under control after more than $4 billion in asset sales over the last couple of years and turning around its exploration and production (E&P) business, CEO Doug L. Foshee told analysts at the UBS 2005 Natural Gas and Electric Utilities Conference on Wednesday.

TransCanada has reached a settlement agreement with its shippers on its 2005 Canadian mainline transportation toll structure. The new tolls, which still must be filed at the National Energy Board (NEB) and approved, contain no major surprises. They include a similar level of operation and maintenance expenses and depreciation costs as in 2004, and a 9.56% return on equity — as set by the NEB.

Capgemini Energy LP, a joint venture formed by Capgemini America Inc. and TXU Corp., began operation on Thursday with a complete leadership structure drawn from both parent companies. TXU signed a $3.5 billion, 10-year agreement in May with Capgemini to form the new company. Under the agreement, about 2,700 employees will be transferred from TXU to Capgemini. TXU will own less than 3% of the company and will have the right to sell all of its interest when the contract ends. The company will provide information technology, call center, billing, human resources, supply chain and accounts payable, and finance and accounting services to TXU and other energy companies. Capgemini selected Bob Pryor, its former president of outsourcing services, as its CEO. Elizabeth Lavalley, who most recently served as TXU’s senior vice president of information technology, will be the company’s COO.

Dynegy on Thursday announced that it would reorganize its business structure to require Investor Relations to report directly to CEO Bruce A. Williamson. In conjunction with the news, Peter J. Wilt was named vice president of investor relations and Norelle V. Lundy as director of investor relations.

El Paso Corp. has completed the “creation of a fit-for-purpose organization” that resulted in job losses for about 40% of its corporate officers, 21% of its directors and 9% of the rest of the organization, not including field operations or field services businesses.

McMoRan Exploration Co. said Tuesday that it has separated the roles of chairman and CEO to strengthen its corporate governance structure. McMoRan named Glenn A. Kleinert president and CEO, noting that James R. Moffett and Richard C. Adkerson will continue to serve as co-chairmen of the board. McMoRan will be managed through an office of the chairman consisting of Messrs. Moffett, Adkerson and Kleinert. The company said that the office of the chairman will direct the business activities of McMoRan, with Moffett continuing to focus on exploration activities and business strategy including McMoRan’s efforts to develop an LNG facility at its Main Pass Energy Hub offshore Louisiana. Adkerson will focus on financial and administrative activities and financial strategy including the commercial and financing activities for the LNG facility and Kleinert will be responsible for executive management functions including acreage development and production activities. In other McMoRan mangement news, B. M. Rankin, Jr. will continue on as vice chairman of McMoRan’s board, while C. Howard Murrish, executive vice president, will continue in his role in McMoRan’s oil and gas exploration activities. The independent oil and gas E&P company operates offshore in the Gulf of Mexico and onshore in the Gulf Coast area.

Looking for a way to turn things around in the difficult energy marketplace, TXU Corp. last week shook up its senior management structure, while at the same time announcing that the company is in the process of reducing officers overall by about 30%. The moves are part of the company’s action plan to cut 2003 costs by a net $250 million from 2002 levels, aimed at streamlining the organization and increasing focus on the operations of its core businesses in North America.