United

UtiliCorp United said it plans to issue seven million shares ofcommon stock with net proceeds to be used to reduce short-termdebt and other short-term obligations incurred for acquisitions,construction and repayment of long-term debt, and other generalcorporate purposes.

After taking Aquila Gas Pipeline off the auction block inAugust, UtiliCorp United announced plans last week to buy back 5.4million common shares of the company, representing the 18% ofoutstanding AQP common shares it does not already own, for $8 pershare. The price represents a 23% premium to the closing AQP shareprice of $6.50 on Nov. 11.

UtiliCorp United subsidiary Aquila Energy signed an eight-yearcontract to supply gas to a 265 MW independent power project beingbuilt in Rumford, in the paper processing region of western Maine.The contract is valued at $500 million. The plant is one of thefirst merchant facilities being built without a dedicated ratebase, a trend in the gradual deregulation of electricity. The plantis expected to begin operation some time in 2000.

TransCanada PipeLines subsidiary Nova Gas Transmission and twogroups of Canadian producers are on their way to a whole newcompetitive pricing structure aimed at “[taking] on the realcompetition, which are the U.S. basins.”

UtiliCorp United reported a 15% second-quarter earnings risedespite weakened performance in its energy delivery segment,sharply diminished results from Aquila Gas Pipeline, and anelectric rate cut in Missouri. Growth in wholesale energy marketingand international operations get the thanks for boosting 1998second quarter earnings to $23.4 million from $20.3 million a yearearlier.

The Senate Energy and Natural Resources Committee has approvedthe nomination of Bill Richardson, currently U.S. ambassador to theUnited Nations, to become the next secretary to the Department ofEnergy (DOE).

UtiliCorp United said its power marketing operations willcontribute positively to second quarter earnings before interestand taxes. Wholesale electricity volumes for the quarter areexpected to be about 24.8 million MWh, up about 112% from the 1997quarter.

The Senate Committee on Energy and Natural Resources hasscheduled a hearing for July 22 to take up the nomination of BillRichardson, current U.S. ambassador to the United Nations, to behead of the Department of Energy.

The White House nomination of Bill Richardson, U.S. ambassadorto the United Nations, to head up the Department of Energy (DOE) islikely to come under heavy fire once it gets to Capitol Hill.