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FYI
Metropolitan Desk; Section B Metro Business Internet Utility Plans Move to Westchester By Joseph P. Fried 09/21/2000 The New York Times Page 11, Column 5 c. 2000 New York Times Company The New Power Company, an Internet utility, is planning to establish its headquarters in Purchase, N.Y., state and Westchester County officials said yesterday. New Power was formed in May by the Houston energy giant Enron to work with America Online and I.B.M. to sell electricity and natural gas to homes and small businesses over the Internet. It has been temporarily located in Greenwich, Conn. In return for its commitment to create 400 new jobs at its future headquarters and invest $7 million in renovating and outfitting 80,000 square feet at a Purchase office complex, New Power is eligible to apply for hundreds of thousands of dollars in energy discounts and tax exemptions from state and county agencies. Joseph P. Fried (NYT) Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Business; Financial Desk Markets Drillers Seek New Natural Gas Sites 09/21/2000 Los Angeles Times Home Edition Page C-4 Copyright 2000 / The Times Mirror Company Natural gas drillers are turning up the heat on Uncle Sam to open up more areas for exploration, amid the highest gas prices ever. Anadarko Petroleum Corp. said Wednesday it plans to start drilling for natural gas in two parts of the Arctic by early 2002, in hopes that a gas pipeline to the Lower 48 states will be built by 2008. The company last month bought the right to explore 176,000 acres in the MacKenzie Delta of the Canadian Arctic. It will begin seismic shooting, which maps the geology of potential drilling sites, this winter in both the Delta and Alaska's North Slope, said John Seitz, president and chief operating officer. Natural gas prices in the last decade haven't been high enough to justify the expense of building a gas pipeline from Alaska, major oil companies have said. But with prices having doubled this year, interest in building a line has been renewed. Gas futures on the New York Mercantile Exchange fell 4.5 cents to $5.318 per million British thermal units Wednesday, down just slightly from Tuesday's record. "The country needs gas from the Arctic," Seitz said, speaking at the Dain Rauscher Wessels oil and gas conference in Houston. About a dozen companies have pipeline proposals on the table, Seitz said. He estimated that at least one route could be built by 2008. Some estimates are for as early at 2005, he said. Drilling on both Anadarko's MacKenzie and North Slope properties could begin in December 2001 or January 2002, Seitz said. But chances for construction of a gas pipeline could be threatened if the government intervenes to push down prices, experts say. "We've got an election year, so anything's up for grabs," said Lisa Stewart, executive vice president of business development for oil and gas explorer Apache Corp. Another energy giant, gas producer and energy trader Enron Corp., also warned against government intervention. "Markets do correct, and this market also will correct," Enron CEO Kenneth Lay said at the Governors' Natural Gas Summit in Columbus, Ohio. "As long as the regulators will leave it alone . . . this market will come back into balance in the next two or three years." Without government interference, Apache thinks prices will remain appealing enough to spur new drilling. Stewart noted that gas inventories are low nationwide and demand is expected to boom. The government will probably move or be pressured to open up lands now off limits to explorers, rather than impose price controls, Seitz said. California and the Rocky Mountains are ripe for exploration, he said. "The solution for the prices is more supply, and we need to have more land to explore and exploit," he said. Shares of both Anadarko and Apache rose Wednesday, even as many other energy stocks fell. Anadarko (ticker symbol: APC) gained 95 cents to $64; Apache rose 19 cents to $62.69. Both trade on the New York Stock Exchange. Enron (ENE), one of the hottest energy stocks, fell $2.69 to $82.17 on the New York Stock Exchange. (BEGIN TEXT OF INFOBOX / INFOGRAPHIC) Gas Stocks on Fire Shares of gas and oil exploration and production companies Anadarko Petroleum (ticker symbol: APC) and Apache Corp. (APA) have rocketed this year as gas and oil prices have soared. * Monthly closes and latest for Anadarko and Apache on the New York Stock Exchange Anadarko Wednesday: $64.00, up 95 cents * Apache Wednesday: $62.69, up 19 cents Source: Bloomberg News GRAPHIC: Gas Stocks on Fire, Los Angeles Times; Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Enron's CEO Lay: Don't Overreact To Natural Gas Prices 09/21/2000 Dow Jones Energy Service (Copyright © 2000, Dow Jones & Company, Inc.) (This article was originally published Wednesday) HOUSTON -(Dow Jones)- The competitive natural gas market can deliver reliable service and help consumers reduce exposure to rising gas prices, Enron Corp. (ENE) chairman and chief executive officer Kenneth Lay said Wednesday in Ohio. Using a number of slide graphics, Lay spoke at Wednesday's natural gas summit in Columbus, Ohio, convened by Alaska Gov. Tony Knowles and Ohio Gov. Bob Taft. Lay warned against overreacting to the recent run-up in prices and urged officials to encourage utilities to take advantage of price hedging opportunities to protect consumers against price volatility. Lay said the Nymex natural gas futures board shows gas prices, although at a peak $5.495 per million British thermal units, declining to $3.345/MMBtu by September 2003. "The gas resource base remains robust and today's prices will self-correct over time," Lay said. Overall, he said, the market has delivered more than $174 billion in savings to consumers since the market opened to competition in 1984. Lay said those utilities that haven't protected their customers against rising prices this winter will pay less per unit of gas than they did in the early 1980s. The Enron chairman, a close friend of Republican Texas Gov. George W. Bush, also urged government officials to consider lifting access restrictions to develop new gas supplies to meet growing electricity generation demand from the growing digital economy. Federal statutes restrict production drilling in the U.S. Eastern Seaboard, the Gulf Coast of Florida and California, and the Rockies, Lay said.. About 400 people attended the one-day conference Wednesday, sponsored by the Interstate Oil and Gas Compact Commission (IOGCC). Also offering presentations were Dr. Fausto Alzati Araiza, Mexican President-Elect Vicente Fox's energy advisor and Nick Schultz, vice president of regulatory and transportation policy for the Canadian Association of Petroleum Producers. Daniel Yergin, chairman of Cambridge Energy Research Associates, also urged a "continent-wide" response by industry and government to address the current natural gas price shock and meet long-term energy needs. The price shock means most U.S. utilities anticipate an increase of between 20%-40% in residential heating bills this winter while industrial customers will be hit even harder - as much as 50%-100% increases in energy costs, Yergin said. -By John Edmiston, Dow Jones Newswires, 713-547-9209; john.edmiston@dowjones.com Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Report on Business: Technology At Work Web consultants feel dot-com pain Failure of many Internet startups causes plunge in consulting revenue DOUGLAS A. BLACKMON AND ANN CARRNS Wall Street Journal 09/21/2000 The Globe and Mail Metro T6 All material copyright Thomson Canada Limited or its licensors. All rights reserved. A big dose of reality is sinking in for the Web's professional gurus. After months of defying the gravitational pull of imploding dot-coms, revenues are plunging at some Internet consulting firms as big companies shift their investment strategies for Web technology. Investors have reacted by letting the air out of a slew of once high-flying stocks. One of the fastest-growing consultancies, iXL Enterprises Inc., announced the layoff of 350 workers less than a week after the resignation of its president and an announcement that revenue in the current quarter will be as much as 20 per cent lower than expected. Meanwhile, there were signs that an earlier generation of consulting firms was trying to move in for the kill, mounting raids to steal talented young Web experts from the battered firms. Deloitte Consulting was the most brazen, taking out a full-page ad in The Wall Street Journal urging employees of Web firms to jump ship. The extent and precise nature of the Web consulting fallout isn't clear. iXL, Viant Corp. and Xpedior Inc., each of which have issued warnings of lower-than-anticipated third-quarter revenues, maintain that large firms are slowing spending as they feel less pressure from Internet start-ups. "In June and July, the global 1,000 companies started looking around and saying, 'Holy Cow, these dot-coms aren't around anymore, nipping at my heels . . . I'm going to take more time to make these decisions,' " said William Nussey in an interview after he resigned as president of iXL. But senior executives at major corporations say that while the climate and pace may have changed, they are still investing heavily in the Internet. Bank of America, for instance, announced in July that it plans to spend $70-million (U.S.) on electronic commerce initiatives over the coming six months. Kevin Koertje, marketing director at Boise Cascade Corp.'s office-products unit, which generates hundreds of millions in on-line sales, said the company "is pouring a tonne more money" into Web systems. But much of that is going to older firms with expertise in legacy computer systems, such as KPMG Consulting, and to narrowly specialized technology experts. Indeed, the biggest shift in Web consulting may be simply that some customers are no longer convinced they want outside help in developing on-line strategies. Xpedior, for instance, said Sears Roebuck & Co., which is building up its in-house Web expertise, has reduced its use of the consulting firm's services this year. Analysts say investors must differentiate between firms with true strategic expertise to sell and those that are merely proficient at setting up Web sites. Mayank Tandon, an analyst with Janney Montgomery Scott, said firms with true "intellectual capital" will be the ones to succeed, citing Chicago consultant Diamond Technology Partners Inc., which works closely with Goldman Sachs Group Inc. and Enron Corp. Raul Fernandez, chief executive officer of Proxicom Inc. of Reston, Va., said his firm is on track to meet revenue projections. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Colorado Utility Plans to Build a Power Plant Near Colorado Springs Rich Laden 09/21/2000 KRTBN Knight-Ridder Tribune Business News: The Gazette - Colorado Springs, Colorado Copyright (C) 2000 KRTBN Knight Ridder Tribune Business News; Source: World Reporter (TM) An arm of energy giant Enron Corp. will build a $100 million power plant south of Colorado Springs to sell electricity to the former Public Service Co. of Colorado, which wants to add generating capacity around the state. The plant, to consist of four natural gas-powered turbines generating 215 megawatts, will be built near an existing electric substation, west of Interstate 25 and about six miles south of Colorado Springs Utilities' Ray Nixon Power Plant. Denver-based Xcel Energy Inc., formerly Public Service, serves Denver, northern Colorado and other areas outside of Colorado Springs. It plans to spend $1.55 billioncq to upgrade its power-generation and transmission capacity around the state. The goal is to have enough new power for 1.6 million households beyond the 2.5 million customers Xcel Energy now serves. Earlier this year, Xcel sought proposals from companies interested in meeting its projected power needs. Enron North America Corp., a subsidiary of Houston-based Enron, an electric, gas and communications powerhouse, was one of nine successful bidders responding to Xcel's request for proposals. Those nine bidders will help supply about 1,500 megawatts of generating capacity around Colorado. Another successful bidder, Wilexco Inc. of Englewood, also was chosen by Xcel, and plans to build an 83-megawatt plant south of the planned Enron facility at a cost of more than $90 million. It will burn tires to generate its power although the facility still needs to clear various local and state regulatory hurdles. Enron should complete its facility by June, said Eric Thode, director of public relations for Enron North America Corp. Wilexco's plant is targeted for operation by 2003, said company owner Brian Wilde. Xcel spokeswoman Jessica Anderson said her company has a 10-year deal with Enron to buy power. Wilde said his deal with Xcel is for 15 years. "The people who live and work here in Colorado need this additional generation," Anderson said. At the end of those initial contracts, Enron and Wilexco could sell power to other users. The opportunity for such deals might be enhanced if Colorado deregulates its electric industry and opens it up to competition. Until now, state lawmakers have rejected deregulation efforts. Still, Anderson said, the addition of the power plants helps position the state for the time when deregulation takes place. Xcel, as Public Service, supported deregulation legislation in the General Assembly. Wilde, of Wilexco, said selling electricity in a deregulated market wasn't the reason his firm sought to build its plant because he doesn't know what the electric industry will be like in 15 years. Thode echoed that sentiment, saying, "This plant is being built for the deal as it currently exists. This deal makes sense because this deal makes sense, period." Colorado Springs Utilities also is adding generating capacity. Two 30-megawatt, gas-fired turbines have been added to the Nixon Plant, which burns coal to generate its power. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Houston Chronicle Thursday, September 21 Business Briefs Koch forms unit to trade bandwidth WICHITA, Kan. -- Closely held Koch Industries, one of the world's largest energy traders, said it has formed a unit to trade bandwidth, or spare capacity on fiber-optic cables. Koch Global Bandwidth Services will be led by Bill Mohl, who has held several senior management jobs at Koch for the past five years. He also was vice president at Altra Energy Technologies. The unit will be based in Houston. Koch Industries, based in Wichita, joins companies such as Houston-based Enron Corp. and Tulsa-based Williams Cos. that have diversified into trading bandwidth from their pipeline business. Enron plans to spend as much as $1.95 billion over the next two to three years to expand its fiber-optic network and broadband-trading operations, Chief Executive Ken Lay said Wednesday in Houston. USA: Profit-taking hits Enron stock. 09/20/2000 Reuters English News Service (C) Reuters Limited 2000. HOUSTON, Sept 20 (Reuters) - Energy marketer Enron Corp. saw its stock fall sharply for a second day Wednesday, a move analysts attributed to profit-taking after a strong run for the shares since early July. Enron closed $2-11/16 lower at $82-3/16 on the New York Stock Exchange Wednesday after losing $5-9/16 Tuesday, making a total decline of slightly more than 9 percent over both days. Analysts noted the decline followed a strong performance by the stock, which broke above a mid-$60s to mid-$70s trading range in August to hit a 52-week high of $90-9/16 on Aug. 23, more than doubling its end-1999 value of $44-6/16. "Inevitably you are going to get some profit-taking as we get near the end of the quarter and people want to lock in some of their profits," said Merrill Lynch analyst Donato Eassey. Ed Tirello of Deutsche Banc Alex Brown said the decline was due in part to investors viewing Enron as a technology play, because of its online trading and broadband businesses. Consequently Enron's stock was susceptible to weakness in the tech-heavy Nasdaq market this month, which appeared to have triggered selling by momentum investors, Tirello said. Merrill Lynch's Eassey said Enron's stock might also have been hurt by an article in the weekly Texas supplement to the Wall Street Journal, which called into question the trading profits reported by Enron and other big energy marketers. Eassey dismissed the article as "misleading" and said he retained a Buy rating on Enron's stock with a 12 month-price target of $95. "This is a stock that you've got to have in your core portfolio. Enron is still one of the premier companies that you can own in all of the market," he said. However, investing in Enron was not without risks and amounted to betting on the company's ability to execute successfully on new technology opportunities, he added. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.
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