<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 3, 1999
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
------------------------
EL PASO ENERGY CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 76-0568816
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
</TABLE>
<TABLE>
<S> <C>
BRITTON WHITE JR.
EXECUTIVE VICE PRESIDENT
AND GENERAL COUNSEL
EL PASO ENERGY BUILDING EL PASO ENERGY BUILDING
1001 LOUISIANA STREET 1001 LOUISIANA STREET
HOUSTON, TEXAS 77002 HOUSTON, TEXAS 77002
(713) 420-2131 (713) 420-2131
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
INCLUDING NUMBER,
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE INCLUDING AREA CODE, OF AGENT FOR SERVICE)
OFFICES)
</TABLE>
------------------------
COPIES TO:
G. MICHAEL O'LEARY, ESQ.
ANDREWS & KURTH L.L.P.
600 TRAVIS, SUITE 4200
HOUSTON, TEXAS 77002
(713) 220-4360
------------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement, as determined
in light of market conditions and other factors.
------------------------
If the only securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
PROPOSED
MAXIMUM PROPOSED
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(2) PER SHARE(3) OFFERING PRICE(3) REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock(1)................. 286,481 $36.4375 $10,438,651.44 $2,901.95
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes preferred stock purchase rights relating to each share of Common
Stock, par value $3.00 per share. The preferred stock purchase rights are
associated with and trade with the Common Stock.
(2) The number of shares of Common Stock registered hereby is subject to
adjustment to prevent dilution resulting from stock splits, stock dividends
or similar transactions.
(3) Estimated solely for the purpose of determining the registration fee.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
SUBJECT TO COMPLETION -- MAY 3, 1999
PROSPECTUS
, 1999
286,481 SHARES
EL PASO ENERGY CORPORATION
COMMON STOCK
- --------------------------------------------------------------------------------
EL PASO ENERGY CORPORATION:
- - El Paso Energy is a diversified energy holding company. It is engaged through
its subsidiaries in the interstate and intrastate transportation, gathering,
and processing of natural gas, marketing of natural gas, power, and other
energy-related commodities, power generation, and the development and
operation of energy infrastructure facilities worldwide. El Paso Energy owns
the only integrated coast-to-coast natural gas pipeline system in the United
States.
- - El Paso Energy Corporation
El Paso Energy Building
1001 Louisiana Street
Houston, Texas 77002
(713) 420-2131
TRADING SYMBOL & MARKET:
- - EPG/New York Stock Exchange
THE OFFERING:
- - This prospectus relates to 286,481 shares of our common stock, par value $3.00
per share.
- - All of the shares are being offered by the selling stockholders named in this
prospectus. We will not receive any proceeds from this offering but will incur
some of the expenses.
- - On , 1999, the closing price of our common stock on the NYSE was
$ per share, and there were shares outstanding on that date.
THIS INVESTMENT INVOLVES RISK. SEE "RISK FACTORS" ON PAGE 2.
- --------------------------------------------------------------------------------
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED
OF THESE SECURITIES OR DETERMINED THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
WE WILL AMEND AND COMPLETE THE INFORMATION IN THIS PROSPECTUS. ALTHOUGH WE ARE
PERMITTED BY UNITED STATES FEDERAL SECURITIES LAWS TO OFFER THESE SECURITIES
USING THIS PROSPECTUS, WE MAY NOT SELL THEM OR ACCEPT YOUR OFFER TO BUY THEM
UNTIL THE DOCUMENTATION FILED WITH THE SEC RELATING TO THESE SECURITIES HAS BEEN
DECLARED EFFECTIVE BY THE SEC. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE
SECURITIES OR OUR SOLICITATION OF YOUR OFFER TO BUY THESE SECURITIES IN ANY
JURISDICTION WHERE THAT WOULD NOT BE PERMITTED OR LEGAL.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<S> <C>
Risk Factors........................... 2
Cautionary Statement Regarding
Forward-Looking Statements........... 4
Business of El Paso Energy............. 6
Use of Proceeds........................ 7
Selling Stockholders................... 8
Where You Can Find
More Information..................... 8
Plan of Distribution................... 10
Legal Matters.......................... 11
Experts................................ 11
</TABLE>
<PAGE> 4
RISK FACTORS
Before you invest in our common stock, you should read the risks,
uncertainties and factors which may adversely affect El Paso Energy that are
discussed under the caption "Risk Factors -- Cautionary Statement For Purposes
of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of
1995" in the El Paso Energy 1998 Annual Report on Form 10-K and which are
incorporated by reference in this prospectus, as well as the following
additional risk factors which contemplate the consummation of the proposed
merger of El Paso Energy and Sonat Inc. discussed in this prospectus in the
section "Business of El Paso Energy -- Merger with Sonat Inc."
RISKS RELATED TO THE PROPOSED MERGER WITH SONAT AND SONAT'S OPERATIONS
THE STRUCTURE OF THE MERGER WILL NOT BE KNOWN UNTIL AFTER THE EL PASO ENERGY
STOCKHOLDERS' SPECIAL MEETING.
Because the structure of the merger depends on the vote of our
stockholders, we will not know until after the special meeting the structure of
the merger and type of consideration we will be required to pay for shares of
Sonat common stock.
PAYMENTS OF DIVIDENDS ON SENIOR VOTING PREFERRED STOCK ISSUED UNDER THE
ALTERNATIVE MERGER STRUCTURE WOULD REDUCE THE FUNDS AVAILABLE TO THE COMBINED
COMPANY TO FUND GROWTH AND OPERATIONS.
We currently estimate that, if we complete the alternative merger, dividend
payments in respect of the senior voting preferred stock would be between
approximately $256 million and $356 million annually based on the number of
shares of El Paso Energy common stock, shares of Sonat common stock and Sonat
options outstanding as of March 5, 1999, and an assumed dividend rate of 8.75%.
The actual annual dividend rate will be set at a rate that our financial
advisors believe would cause the depositary shares, when fully distributed after
completion of the alternative merger, to trade initially at approximately $100
per share. Because we would be using cash to pay these dividends, the amount of
cash we would have available for expansion opportunities and ongoing operations
would be significantly reduced.
EL PASO ENERGY AND SONAT COULD BE REQUIRED TO EFFECT SIGNIFICANT DIVESTITURES
OR COMPLY WITH OTHER REGULATORY REQUIREMENTS.
We cannot complete the merger until the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, (the HSR Act)
has expired or terminated. We are also required to obtain the approval of the
Federal Energy Regulatory Commission (the FERC) in order to complete the merger.
El Paso Energy and Sonat are both obligated, under the terms of the merger
agreement, to use their "reasonable best efforts" to take all action to ensure
that the waiting period under the HSR Act and all extensions of that period
expire or are terminated and other required approvals are obtained. Neither of
us is obligated, however, to take actions that would reasonably be likely to
have a material adverse effect on the business, financial condition, or results
of operations of the combined company after the merger, and El Paso Energy is
not obligated to take actions that would reasonably be likely to have a material
adverse effect on its subsidiary, Tennessee Gas Pipeline Company. Governmental
authorities could require the companies to effect significant divestitures as a
condition to approving the transaction or impose other conditions that would
affect subsequent operations of the combined company.
We cannot assure you that these and any other required regulatory approvals
will be obtained or, if they are obtained, as to the terms, conditions and
timing of these approvals. These requirements for
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<PAGE> 5
regulatory approvals could delay completion of the merger for a significant
period of time after the Sonat and El Paso Energy stockholders have approved the
merger at the special meetings.
IF THE MERGER IS COMPLETED UNDER THE ALTERNATIVE MERGER STRUCTURE, THE MERGER
WILL BE DILUTIVE TO OUR EARNINGS PER SHARE FOR AT LEAST THREE YEARS.
THE RATES THAT SONAT'S PIPELINE SUBSIDIARY IS ABLE TO CHARGE ITS CUSTOMERS MAY
BE REDUCED BY GOVERNMENTAL AUTHORITIES.
The pipeline transportation business conducted by Sonat's subsidiary,
Southern Natural Gas Company, is regulated by the FERC and various state and
local regulatory agencies. In particular, the FERC generally limits the rates
the Sonat subsidiary is permitted to charge its customers for interstate
transportation and, in some cases, sales of natural gas. If the rates the Sonat
subsidiary is permitted to charge its customers for transportation are lowered,
the profitability of Sonat's pipeline business may be reduced. Under the terms
of a settlement approved by the FERC, Sonat's subsidiary is required to file a
new rate case no later than September 1, 1999, to become effective by March 1,
2000. We cannot predict the outcome of that rate case.
MANY OF THE CONTRACTS FOR NATURAL GAS TRANSMISSION BY SONAT'S SUBSIDIARY WILL
EXPIRE WITHIN THE NEXT FEW YEARS.
Substantially all of the revenues of Sonat's subsidiary, Southern Natural
Gas Company, are generated under long-term natural gas transportation contracts.
Contracts representing approximately 58% of Southern Natural Gas Company's firm
transportation capacity will expire by their terms by September 1, 2003.
Contracts with one gas distribution customer account for 46% of these expiring
contracts. Although we expect the Sonat subsidiary to negotiate to extend these
contracts, there can be no assurance that it will be able to extend or replace
these contracts or that the terms of any renegotiated contracts will be as
favorable as the existing contracts. If the Sonat subsidiary is unable to renew
these contracts or if it renews them on less favorable terms, it may suffer a
material reduction in revenue and earnings.
THE SUCCESS OF SONAT'S EXPLORATION AND PRODUCTION BUSINESS IS DEPENDENT ON
FACTORS WHICH CANNOT BE PREDICTED WITH CERTAINTY.
The performance of Sonat's exploration and production business is dependent
upon a number of factors that cannot be predicted with certainty. These factors
include:
- the effect of oil and natural gas prices on revenues;
- the results of future drilling activity;
- Sonat's ability to identify and precisely locate prospective geologic
structures and to drill and successfully complete wells in those
structures; and
- Sonat's ability to expand leased land positions in desirable areas, which
often are subject to intensely competitive leasing conditions.
KEY PERSONNEL COULD TERMINATE THEIR EMPLOYMENT WITH THE COMBINED COMPANY.
El Paso Energy's senior management has limited experience in the oil and
gas exploration and production business. Although we expect Sonat personnel who
currently operate Sonat's exploration and production business to remain with the
combined company, we cannot assure you that any of these personnel will remain
with the combined company after we complete the merger.
All of the executive officers and other key employees of Sonat are parties
to severance agreements and have the right to receive substantial payments if
their employment is terminated by
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<PAGE> 6
the combined company, if they terminate their employment for good reason after
the merger or, in the case of its executive officers and two other key
executives, if they terminate employment for any reason during the 30-day period
immediately following the first anniversary of the merger. Executive officers
and certain other key employees of El Paso Energy have similar rights under
applicable plans, unless the merger is completed under the alternative merger
structure. In addition, several Sonat executive officers are eligible to
participate in a voluntary reduction-in-force window program if they (1) give
notice of intent to terminate their employment within a 45-day period currently
expected to end on December 31, 1999, and (2) terminate their employment during
a 6-month period currently expected to end on June 30, 2000. These individuals
will be entitled to severance payments under their severance agreements if they
elect to take early retirement. Accordingly, El Paso Energy expects that a
substantial number of Sonat executive officers and other employees will likely
terminate their employment within the year following completion of the merger.
We cannot assure you that, if executive officers and other key employees of
either El Paso Energy or Sonat leave the combined company, we will be able to
find adequate replacements.
WE CANNOT ASSURE YOU THAT EL PASO ENERGY AND SONAT WILL BE SUCCESSFULLY
COMBINED INTO A SINGLE ENTITY.
If we cannot successfully combine our operations we may experience a
material adverse effect on our business, financial condition or results of
operations. The merger involves the combining of two companies that have
previously operated separately. The combining of companies such as Sonat and El
Paso Energy involves a number of risks, including:
- the diversion of management's attention to the combining of operations;
- difficulties in the combining of operations and systems, including plans
to update and test systems for "Year 2000" compliance;
- difficulties in the assimilation and retention of employees;
- challenges in keeping customers; and
- potential adverse short-term effects on operating results.
Among the factors considered by the boards of directors of each company in
approving the merger agreement were the opportunities for economies of scale and
scope and operating efficiencies that could result from the merger. Although we
expect the combined company to achieve significant annual savings in operating
costs as a result of the merger, we may not be able to maintain the levels of
operating efficiency that we each previously achieved or might achieve if we
remain separate. Because of difficulties in combining operations, we may not be
able to achieve the cost savings and other size-related benefits that we hope to
achieve after the merger.
In addition, because (1) Sonat's marketing operations are held through a
joint venture in which Sonat has a 65% interest and (2) its Florida pipeline is
held through a joint venture that is operated by a subsidiary of Enron Corp. and
in which Sonat has a 50% interest, the combined company may not be able to
effectively integrate these operations with similar operations of El Paso Energy
to achieve cost savings in these operations.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
We have made statements in this prospectus and in documents that are
incorporated by reference into this prospectus that constitute forward-looking
statements, as that term is defined in the Private Securities Litigation Reform
Act of 1995. These statements are subject to risks and uncertainties.
Forward-looking statements include information concerning possible or assumed
future
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<PAGE> 7
results of operations of El Paso Energy, Sonat or the combined company. These
statements may relate to, but are not limited to, information or assumptions
about earnings per share, capital and other expenditures, dividends, financing
plans, capital structure, cash flow, pending legal proceedings and claims,
including environmental matters, future economic performance, operating income,
cost savings, management's plans, goals and objectives for future operations and
growth and markets for the common stock of El Paso Energy. These forward-looking
statements generally are accompanied by words such as "intend," "anticipate,"
"believe," "estimate," "expect," "should" or similar expressions. You should
understand that these forward-looking statements are necessarily estimates
reflecting the best judgment of senior management of El Paso Energy, not
guarantees of future performance. They are subject to a number of assumptions,
risks and uncertainties that could cause actual results to differ materially
from those expressed or implied in the forward-looking statements. Important
factors that could cause actual results to differ materially from estimates or
projections contained in forward-looking statements include, among other, the
following:
- the risk that revenues may be affected by fluctuating energy prices;
- the risk that rates charged to customers may be reduced by governmental
authorities;
- the highly competitive nature of the natural gas transportation,
gathering, processing, storage and energy marketing industries;
- the risk of favorable customer contracts expiring or being renewed on
less attractive terms;
- the uncertainty concerning the future success of exploration and
production activities;
- the costs of environmental liabilities, regulations and litigation;
- the impact of operational hazards;
- the risk that required regulatory approvals for proposed pipeline,
storage and power generation projects may be delayed or may only be
granted on terms that are unacceptable or significantly less favorable
than anticipated;
- the risks associated with future weather conditions;
- the risk that the merger with Sonat may not occur;
- the risk that Sonat's businesses may not be successfully integrated with
El Paso Energy's businesses;
- the risk that we may not fully realize the benefits expected to result
from the merger;
- the impact of the loss of key employees;
- the risk that other firms will further expand into markets in which El
Paso Energy or Sonat operate; and
- other risks, uncertainties and factors, including the effect of the year
2000 date change, discussed more completely in El Paso Energy's other
filings with the Securities and Exchange Commission, including the El
Paso Energy 1998 Annual Report on Form 10-K.
Certain of these factors are more fully described in "Risk Factors." Other
factors that could cause actual results to differ materially from estimates and
projections contained in forward-looking statements are described in the
documents that we incorporated by reference into this document. You should not
place undue reliance on forward-looking statements, which speak only as of the
date of this prospectus, or, in the case of documents incorporated by reference,
the date of those documents.
All subsequent written and oral forward-looking statements attributable to
El Paso Energy or any person acting on its behalf are expressly qualified in
their entirety by the cautionary statements contained or referred to in this
section. El Paso Energy does not undertake any obligation to release publicly
any revisions to these forward-looking statements to reflect events or
circumstances after the date of this prospectus or to reflect the occurrence of
unanticipated events.
5
<PAGE> 8
BUSINESS OF EL PASO ENERGY
Our principal operations include:
- the interstate and intrastate transportation, gathering, and processing
of natural gas;
- the marketing of natural gas, power, and other energy-related
commodities;
- power generation; and
- the development and operation of energy infrastructure facilities
worldwide.
We own or have interests in over 28,000 miles of interstate and intrastate
pipeline connecting the nation's principal natural gas supply regions to four of
the largest consuming regions in the United States, namely the Gulf Coast,
California, the Northeast, and the Midwest. Our interstate natural gas
transmission operations include one of the nation's largest and only
coast-to-coast mainline natural gas transmission systems which is comprised of
five interstate pipeline systems: the El Paso Natural Gas pipeline, the
Tennessee Gas pipeline, the Midwestern Gas Transmission pipeline, the East
Tennessee Natural Gas pipeline, and the Mojave pipeline.
In addition to our interstate transmission services, we provide related
services, including natural gas gathering, products extraction, dehydration,
purification, compression, and intrastate transmission. These services include
gathering of natural gas from more than 10,000 natural gas wells with
approximately 11,000 miles of gathering lines, and 23 natural gas processing and
treating facilities located in some of the most prolific and active production
areas of the United States, including the San Juan and Permian Basins and in
east Texas, south Texas, Louisiana, and the Gulf of Mexico. We conduct
intrastate transmission operations through our interests in four Texas
intrastate systems, which include the Oasis pipeline running from west Texas to
Katy, Texas, the Channel pipeline extending from south Texas to the Houston Ship
Channel, and the Shoreline and Tomcat gathering systems which gather gas from
offshore Texas. We also provide intrastate transportation in north Louisiana
through our Gulf States pipeline that runs from the Texas border to Ruston,
Louisiana. Our marketing activities include the marketing and trading of natural
gas, power, and other energy-related commodities, as well as providing
integrated price risk management services associated with these commodities. We
also participate in the development and ownership of domestic power generation
facilities and other power-related assets and joint ventures.
Our international activities focus on the development and operation of
international energy infrastructure projects and include ownership interests in
three major operating natural gas transmission systems in Australia and natural
gas transmission systems and power generation facilities currently in operation
or under construction in Argentina, Bolivia, Brazil, Chile, the Czech Republic,
Hungary, Indonesia, Mexico, Pakistan, Peru, the United Kingdom, Bangladesh, the
Philippines, and China.
Our principal executive offices are in the El Paso Energy Building, located
at 1001 Louisiana Street, Houston, Texas 77002, and our telephone number at that
address is (713) 420-2131.
MERGER WITH SONAT INC.
We entered into the second amended and restated agreement and plan of
merger with Sonat Inc. dated as of March 13, 1999, (the "Merger Agreement")
pursuant to which Sonat will merge into El Paso Energy, and we will issue to
Sonat stockholders one share of El Paso Energy common stock for each share of
Sonat common stock owned by them, and our certificate of incorporation will be
amended to authorize us to issue up to 750 million shares of common stock and 50
million shares of preferred stock. We are planning to hold a special meeting of
our stockholders to consider and vote on a proposal to adopt the Merger
Agreement. If our stockholders do not approve the Merger Agreement, but Sonat
stockholders do approve the Merger Agreement, Sonat will instead merge with a
subsidiary of El Paso Energy under an alternative merger structure, and we will
issue a combination
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of (1) a fraction of a share of El Paso Energy common stock and (2) a fraction
of a depositary share representing a fractional interest in a new series of
senior voting preferred stock of El Paso Energy for each share of Sonat common
stock. We will complete the merger with Sonat only if a number of conditions are
satisfied or waived, including:
- Sonat stockholders adopt the Merger Agreement;
- no law or court order prohibits the transaction;
- all waiting periods under federal antitrust laws applicable to the merger
expire or terminate;
- all other regulatory approvals are received without conditions that would
have a materially adverse effect on the financial condition, results of
operations or cash flow of our combined businesses; and
- attorneys for El Paso Energy and Sonat issue opinions that the merger is
expected to be tax free.
However, we cannot assure you that we will complete the merger even if such
conditions are satisfied.
If the El Paso Energy and Sonat stockholders both approve the Merger
Agreement, El Paso Energy and Sonat will complete the merger on an all common
stock basis, and we expect to account for the merger using the pooling of
interests method of accounting in accordance with United States generally
accepted accounting principles. If our stockholders do not approve the Merger
Agreement, El Paso Energy and Sonat will complete the merger under the
alternative merger structure, and we will account for the merger using the
purchase method of accounting in accordance with United States generally
accepted accounting principles.
Sonat Inc. is a diversified energy holding company. It is engaged through
its subsidiaries and joint ventures in domestic oil and natural gas exploration
and production, in the transmission and storage of natural gas, and in natural
gas and power marketing. Sonat has interests in oil and gas producing properties
in Louisiana, Texas, Oklahoma, Arkansas, Alabama, New Mexico and the Gulf of
Mexico. Sonat owns approximately 1.6 trillion cubic feet equivalent of proved
reserves.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares of
common stock offered by this prospectus.
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<PAGE> 10
SELLING STOCKHOLDERS
This prospectus relates to the sale by certain selling stockholders from
time to time of up to 286,481 shares of El Paso Energy common stock. The selling
stockholders acquired the shares of common stock in connection with our
acquisition of EnCap Investments L.C. The shares of common stock offered by the
selling stockholders are included in the registration statement of which this
prospectus is a part pursuant to an undertaking made in connection with the
EnCap acquisition. The following table sets forth as of May 3, 1999 certain
information with respect to the selling stockholders.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED BEFORE NUMBER OF
OFFERING NUMBER OF SHARES BENEFICIALLY
-------------------- SHARES OWNED AFTER
SELLING STOCKHOLDER NUMBER PERCENT BEING OFFERED OFFERING(1)
------------------- -------- -------- ------------- -------------------
<S> <C> <C> <C> <C>
Eugene C. Fiedorek................... 21,521 * 21,521 0
David B. Miller...................... 39,904 * 39,904 0
Gary R. Peterson..................... 39,904 * 39,904 0
D. Martin Phillips................... 39,904 * 39,904 0
M. Sean Smith........................ 9,057 * 9,057 0
Robert L. Zorich..................... 39,904 * 39,904 0
Banc One Capital Partners VIII,
Ltd................................ 96,287 * 96,287 0
Total................................ 286,481 * 286,481 0
</TABLE>
- -------------------------
* Less than 1%
(1) Assumes that each selling stockholder will sell all of the shares set forth
above under "Number of Shares Being Offered." The selling stockholders may
offer all, some or none of their shares.
We will pay all costs and expenses incurred in connection with the
registration under the Securities Act of 1933 of the shares offered hereby,
including, but not limited to, all registration and filing fees, the NYSE
listing fee, printing expenses and fees and disbursements of counsel and
accountants for El Paso Energy. The selling stockholders will pay all brokerage
fees and commissions, if any, incurred in connection with the sale of the
shares.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement under the Securities
Act of 1933 that registers the shares to be sold by the selling stockholders.
The registration statement, including the attached exhibits, contains additional
relevant information about us. The rules and regulations of the SEC allow us to
omit some information included in the registration statement from this
prospectus.
In addition, we file reports, proxy statements and other information with
the SEC under the Securities Exchange Act of 1934. You may read and copy this
information at the following locations of the SEC:
<TABLE>
<S> <C> <C>
Public Reference Room New York Regional Office Chicago Regional Office
Room 1024 Suite 100 Citicorp Center
450 Fifth Street, N.W. 7 World Trade Center Suite 1400
Washington, D.C. 20549 New York, New York 10048 500 West Madison Street
Chicago, Illinois 60661-2511
</TABLE>
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You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, at prescribed rates. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference rooms. The SEC also maintains an
Internet World Wide Web site that contains reports, proxy statements and other
information about issuers, including El Paso Energy and Sonat, who file
electronically with the SEC. The address of that site is http://www.sec.gov. You
can also inspect reports, proxy statements and other information about each of
us at the offices of The New York Stock Exchange, Inc., located at 20 Broad
Street, New York, New York 10005.
The SEC allows us to "incorporate by reference" information into this
document. This means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information
incorporated by reference is considered to be part of this document, except for
any information that is superseded by information that is included directly in
this document.
We incorporate by reference the documents listed below that we have
previously filed with the SEC. They contain important information about our
company and its financial condition. Some of these filings have been amended by
later filings, which are also listed.
<TABLE>
<CAPTION>
OUR SEC FILINGS (FILE NO. 1-14365) DESCRIPTION OR PERIOD/AS OF DATE
---------------------------------- --------------------------------
<S> <C>
Annual Report on Form 10-K Year ended December 31, 1998
Current Report on Form 8-K, dated March Discloses the entering into of the merger
15, 1999 agreement between El Paso Energy and Sonat
and related matters
Current Report on Form 8-K, dated April Discloses preliminary unaudited pro forma
23, 1999 financial information of El Paso Energy
and Sonat giving effect to their proposed
merger
Current Report on Form 8-K, dated April Discloses first quarter operating results
23, 1999 of El Paso Energy
Current Report on Form 8-K/A, dated April Amends our Current Report on Form 8-K
30, 1999 dated April 23, 1999 disclosing pro forma
financial information
Registration Statement on Form 8-A, dated Contains a description of the El Paso
August 3, 1998 Energy common stock
Registration Statement on Form 8-A/A dated Contains a description of the El Paso
January 29, 1999 Energy preferred stock purchase rights
Definitive Proxy Statement on Schedule 14A Definitive proxy statement relating to the
1999 annual meeting of El Paso Energy's
stockholders (filed on March 11, 1999)
</TABLE>
We incorporate by reference additional documents that either company may
file with the SEC until all of the shares offered by this prospectus have been
sold. These documents include periodic reports, including Annual Reports on Form
10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as
proxy statements.
You can obtain any of the documents incorporated by reference in this
document through us or from the SEC through the SEC's web site at the address
provided above. Documents incorporated by reference are available from us
without charge, excluding any exhibits to those documents unless the exhibit is
specifically incorporated by reference as an exhibit in this document. You can
obtain
9
<PAGE> 12
documents incorporated by reference in this document by requesting them in
writing or by telephone from us at the following address:
El Paso Energy Corporation
Office of Investor Relations
El Paso Energy Building
1001 Louisiana Street
Houston, Texas 77002
Telephone No.: (713) 420-2131
WE HAVE NOT AUTHORIZED ANYONE TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION THAT DIFFERS FROM, OR ADDS TO, THE INFORMATION IN THIS DOCUMENT
OR IN OUR DOCUMENTS THAT ARE PUBLICLY FILED WITH THE SEC. THEREFORE, IF ANYONE
DOES GIVE YOU DIFFERENT OR ADDITIONAL INFORMATION, YOU SHOULD NOT RELY ON IT.
IF YOU ARE IN A JURISDICTION WHERE IT IS UNLAWFUL TO OFFER TO EXCHANGE OR
SELL, OR TO ASK FOR OFFERS TO EXCHANGE OR BUY, THE SHARES OF COMMON STOCK
OFFERED BY THIS DOCUMENT, OR IF YOU ARE A PERSON TO WHOM IT IS UNLAWFUL TO
DIRECT THESE ACTIVITIES, THEN THE OFFER PRESENTED BY THIS DOCUMENT DOES NOT
EXTEND TO YOU.
THE INFORMATION CONTAINED IN THIS DOCUMENT SPEAKS ONLY AS OF ITS DATE
UNLESS THE INFORMATION SPECIFICALLY INDICATES THAT ANOTHER DATE APPLIES.
PLAN OF DISTRIBUTION
The shares of common stock offered by the selling stockholders may be
offered and sold by means of this prospectus from time to time as market
conditions permit in one or more transactions on the NYSE, in the
over-the-counter market, in negotiated transactions or otherwise, or through a
combination of these methods, at fixed prices, which may be changed, at prices
and terms then prevailing or at prices related to the then-current market price,
or at negotiated prices. These shares may be sold by one or more of the
following methods, without limitation:
- a block trade in which a broker or dealer will attempt to sell the shares
as agent but may position and resell a portion of the block as principal
to facilitate the transaction;
- purchases by a broker or dealer as principal and resale by the broker or
dealer for its account pursuant to this prospectus;
- ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and
- face-to-face transactions between sellers and purchasers without brokers
or dealers.
In making sales, brokers or dealers engaged by the selling stockholders may
arrange for other brokers or dealers to participate. These brokers or dealers
may receive commissions or discounts from selling stockholders in amounts to be
negotiated.
To the extent required, this prospectus may be amended or supplemented from
time to time to describe a specific plan of distribution. In effecting sales,
brokers or dealers engaged by the selling stockholders may arrange for other
brokers or dealers to participate in the resales.
The selling stockholders and any persons who participate in the
distribution of the shares offered by this prospectus may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, and any
commissions received by them and profit on any resale of the shares as principal
may be considered underwriting discounts and commissions under the Securities
Act of 1933.
The shares will be sold only through registered or licensed brokers or
dealers if required under applicable state securities laws. In addition, in
certain states the shares may not be sold unless they
10
<PAGE> 13
have been registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is available and is
complied with.
Under applicable rules and regulations under the Securities Exchange Act of
1934, any person engaged in the distribution of the shares may not
simultaneously engage in market making activities with respect to our common
stock for a specified period prior to the commencement of such distribution and
until its completion. In addition, each selling stockholder will be subject to
applicable provisions of the Securities Exchange Act of 1934 and the associated
rules and regulations under the Securities Exchange Act of 1934, including
Regulation M, which provisions may limit the timing of purchases and sales of
shares of our common stock by the selling stockholders. We will make copies of
this prospectus available to the selling stockholders and have informed them of
the need for delivery of copies of this prospectus to purchasers at or prior to
the time of any sale of the shares.
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be passed
upon by Andrews & Kurth L.L.P., Houston, Texas.
EXPERTS
The consolidated financial statements and financial statement schedule of
El Paso Energy as of December 31, 1998 and 1997, and for the years ended
December 31, 1998, 1997 and 1996, incorporated by reference in this prospectus,
have been incorporated by reference in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
such firm as experts in accounting and auditing.
The consolidated financial statements of Sonat Inc. as of December 31, 1998
and 1997, and for the years ended December 31, 1998, 1997 and 1996, included in
El Paso Energy's Current Report on Form 8-K/A dated April 30, 1999, have been
audited by Ernst & Young LLP, independent auditors, as set forth in their report
thereon included therein and incorporated herein by reference, which, as to the
year ended December 31, 1996, is based on the report of KPMG LLP, independent
auditors. The report of KPMG LLP refers to a change by Zilkha Energy Company in
accounting for oil and gas properties from the full cost method to the
successful efforts method. Such restated consolidated financial statements are
incorporated herein by reference in reliance upon such reports given upon the
authority of such firms as experts in accounting and auditing.
11
<PAGE> 14
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
, 1999
286,481 SHARES
EL PASO ENERGY CORPORATION
COMMON STOCK
----------------------
PROSPECTUS
----------------------
- --------------------------------------------------------------------------------
WE HAVE NOT AUTHORIZED ANY DEALER, SALESPERSON OR OTHER PERSON TO GIVE YOU
WRITTEN INFORMATION OTHER THAN THIS PROSPECTUS OR TO MAKE REPRESENTATIONS AS TO
MATTERS NOT STATED IN THIS PROSPECTUS. YOU MUST NOT RELY ON UNAUTHORIZED
INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES OR OUR
SOLICITATION OF YOUR OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE
THAT WOULD NOT BE PERMITTED OR LEGAL. NEITHER THE DELIVERY OF THIS PROSPECTUS
NOR ANY SALES MADE HEREUNDER AFTER THE DATE OF THIS PROSPECTUS SHALL CREATE AN
IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR THE AFFAIRS OF EL PASO
ENERGY HAVE NOT CHANGED SINCE THE DATE HEREOF.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than selling
or underwriting discounts and commissions, to be incurred by El Paso Energy in
connection with the issuance and distribution of the shares of common stock
being registered. All amounts shown are estimated except the Commission
registration fee.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 2,901
Printing and engraving expenses............................. 9,500
Legal fees and expenses..................................... 10,000
Accounting fees and expenses................................ 5,000
Miscellaneous............................................... 1,500
-------
Total.................................................. $28,901
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses (including attorneys' fees), judgments, fines, and
amounts paid in settlement in connection with specified actions, rules, or
proceedings, whether civil, criminal, administrative, or investigative (other
than action by or in the right of the corporation -- a "derivative action"), if
they acted in good faith and in a manner they reasonably believed to be in or
not opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe their conduct
was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses (including
attorneys' fees) incurred in connection with the defense or settlement of such
action, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's charter, by-laws,
disinterested director vote, stockholder vote, agreement, or otherwise.
Article X of El Paso Energy's By-laws require indemnification to the full
extent permitted under Delaware law as from time to time in effect. Subject to
any restrictions imposed by Delaware law, the By-laws of El Paso Energy provide
an unconditional right to indemnification for all expense, liability, and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes, or penalties
and amounts paid in settlement) actually and reasonably incurred or suffered by
any person in connection with any actual or threatened proceeding (including, to
the extent permitted by law, any derivative action) by reason of the fact that
such person is or was serving as a director, officer, or employee of El Paso
Energy or that, being or having been such a director or officer or an employee
of El Paso Energy, such person is or was serving at the request of El Paso
Energy as a director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, including an employee
benefit plan. The By-laws of El Paso Energy also provide that El Paso Energy
may, by action of its Board of Directors, provide indemnification to its agents
with the same scope and effect as the foregoing indemnification of directors and
officers.
Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the
II-1
<PAGE> 16
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability for (i) any breach of the director's
duty of loyalty to the corporation or its stockholders, (ii) acts or omissions
not in good faith or which involve intentional misconduct or a knowing violation
of law, (iii) payment of unlawful dividends or unlawful stock purchases or
redemptions, or (iv) any transaction from which the director derived an improper
personal benefit.
Article 10 of El Paso Energy's Restated Certificate of Incorporation, as
amended, provides that to the full extent that the Delaware General Corporation
Law, as it now exists or may hereafter be amended, permits the limitation or
elimination of the liability of directors, a director of El Paso Energy shall
not be liable to El Paso Energy or its stockholders for monetary damages for
breach of fiduciary duty as a director. Any amendment to or repeal of such
Article 10 shall not adversely affect any right or protection of a director of
El Paso Energy for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal.
El Paso Energy maintains directors' and officers' liability insurance which
provides for payment, on behalf of the directors and officers of El Paso Energy
and its subsidiaries, of certain losses of such persons (other than matters
uninsurable under law) arising from claims, including claims arising under the
Securities Act, for acts or omissions by such persons while acting as directors
or officers of El Paso Energy and/or its subsidiaries, as the case may be.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<C> <C> <S>
4.1 -- Restated Certificate of Incorporation of El Paso Energy;
Certificate of Designation, Preferences and Rights of Series
A Junior Participating Preferred Stock of El Paso Energy,
dated July 16, 1998 (incorporated by reference to Exhibit
3.1 to El Paso Energy's Form 8-K, filed August 3, 1998)
4.2 -- By-laws of El Paso Energy, as amended dated October 21, 1998
(incorporated by reference to Exhibit 3.B to El Paso
Energy's Form 10-Q, filed November 12, 1998)
4.3 -- Amended and Restated Shareholder Rights Agreement, dated
January 20, 1999, between El Paso Energy and BankBoston,
N.A., as Rights Agent (incorporated by reference to Exhibit
1 of El Paso's registration statement on Form 8-A/A
Amendment No. 1, filed January 29, 1999)
5.1 -- Opinion of Andrews & Kurth L.L.P. as to the legality of the
common stock being registered
23.1 -- Consent of PricewaterhouseCoopers LLP
23.2 -- Consent of Ernst & Young LLP
23.3 -- Consent of KPMG LLP
23.4 -- Consent of Andrews & Kurth L.L.P. (included in Exhibit 5.1)
24.1 -- Powers of Attorney (included on signature page)
</TABLE>
II-2
<PAGE> 17
ITEM 17. UNDERTAKINGS
A. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(b) To reflect in the Prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement; and
(c) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in this Registration Statement;
provided, however, that paragraphs A(l)(a) and A(l)(b) above do not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the Registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, such filing of El Paso
Energy's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Registrant pursuant to the provisions described in Item 15 above, or otherwise,
the Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer, or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer, or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on May 3, 1999.
EL PASO ENERGY CORPORATION
By: /s/ WILLIAM A. WISE
------------------------------------
William A. Wise
Chairman of the Board, President
and Chief Executive Officer
POWER OF ATTORNEY
Each person whose individual signature appears below hereby authorizes H.
Brent Austin and Britton White Jr., and each of them as attorneys-in-fact with
full power of substitution, to execute in the name and on behalf of such person,
individually and in each capacity stated below, and to file, any and all
amendments to this Registration Statement, including any and all post-effective
amendments.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates as indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ WILLIAM A. WISE Chairman of the Board, May 3, 1999
- --------------------------------------------------- President, Chief Executive
William A. Wise Officer and Director
/s/ H. BRENT AUSTIN Executive Vice President and May 3, 1999
- --------------------------------------------------- Chief Financial Officer
H. Brent Austin
/s/ JEFFREY I. BEASON Vice President and Controller May 3, 1999
- --------------------------------------------------- (Chief Accounting Officer)
Jeffrey I. Beason
/s/ BYRON ALLUMBAUGH Director May 3, 1999
- ---------------------------------------------------
Byron Allumbaugh
/s/ JUAN CARLOS BRANIFF Director May 3, 1999
- ---------------------------------------------------
Juan Carlos Braniff
/s/ PETER T. FLAWN Director May 3, 1999
- ---------------------------------------------------
Peter T. Flawn
</TABLE>
II-4
<PAGE> 19
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ JAMES F. GIBBONS Director May 3, 1999
- ---------------------------------------------------
James F. Gibbons
/s/ BEN F. LOVE Director May 3, 1999
- ---------------------------------------------------
Ben F. Love
/s/ KENNETH L. SMALLEY Director May 3, 1999
- ---------------------------------------------------
Kenneth L. Smalley
/s/ MALCOLM WALLOP Director May 3, 1999
- ---------------------------------------------------
Malcolm Wallop
</TABLE>
II-5
<PAGE> 20
EXHIBIT LIST
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<C> <C> <S>
4.1 -- Restated Certificate of Incorporation of El Paso Energy;
Certificate of Designation, Preferences and Rights of Series
A Junior Participating Preferred Stock of El Paso Energy,
dated July 16, 1998 (incorporated by reference to Exhibit
3.1 to El Paso Energy's Form 8-K, filed August 3, 1998)
4.2 -- By-laws of El Paso Energy, as amended dated October 21, 1998
(incorporated by reference to Exhibit 3.B to El Paso
Energy's Form 10-Q, filed November 12, 1998)
4.3 -- Amended and Restated Shareholder Rights Agreement, dated
January 20, 1999, between El Paso Energy and BankBoston,
N.A., as Rights Agent (incorporated by reference to Exhibit
1 of El Paso's registration statement on Form 8-A/A
Amendment No. 1, filed January 29, 1999)
5.1 -- Opinion of Andrews & Kurth L.L.P. as to the legality of the
common stock being registered
23.1 -- Consent of PricewaterhouseCoopers LLP
23.2 -- Consent of Ernst & Young LLP
23.3 -- Consent of KPMG LLP
23.4 -- Consent of Andrews & Kurth L.L.P. (included in Exhibit 5.1)
24.1 -- Powers of Attorney (included on signature page)
</TABLE>
<PAGE> 1
EXHIBIT 5.1
May 3, 1999
Board of Directors
El Paso Energy Corporation
El Paso Energy Building
1001 Louisiana Street
Houston, Texas 77002
Gentlemen:
We have acted as special counsel to El Paso Energy
Corporation, a Delaware corporation (the "Company"), in connection with the
preparation and filing with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), of the
registration statement on Form S-3 filed by the Company with the Commission on
May 3, 1999 (the "Registration Statement"), relating to the offering from
time to time of 286,481 shares (the "Shares") of the Company's common stock,
par value $3.00 per share, by certain selling stockholders named in the
Registration Statement.
In arriving at the opinion expressed below, we have examined
the Company's Certificate of Incorporation and Bylaws, each as amended to date,
the Registration Statement, and the originals or copies certified or otherwise
identified to our satisfaction of such other instruments and other certificates
of public officials, officers and representatives of the Company and such other
persons, and we have made such investigations of law, as we have deemed
appropriate as a basis for the opinions expressed below.
In rendering the opinion expressed below, we have assumed and
have not verified (i) the genuineness of the signatures on all documents that
we have examined, (ii) the conformity to the originals of all documents
supplied to us as certified or photostatic or faxed copies, (iii) the
authenticity of the originals of such documents and (iv) as to the forms of all
documents in respect of which forms were filed with the Commission as exhibits
to the Registration Statement, the conformity in all material respects of such
documents to the forms thereof that we have examined.
Based on the foregoing, and subject to the limitations and
exceptions set forth below, it is our opinion that the Shares are legally
issued and, when sold in the manner contemplated by the Registration Statement,
will continue to be legally issued and will be fully paid and non-assessable.
For the purposes of the opinion expressed above, we have
assumed that the Registration Statement, and any amendments thereto (including
post-effective amendments), will have become effective.
We express no opinion other than as to the federal laws of the
United States of America and the Delaware General Corporation laws. We hereby
consent to the filing of this opinion as an exhibit to the Registration
Statement and to the reference to this firm under the heading "Legal Matters"
in the prospectus forming part of the Registration Statement without admitting
that we are "experts" under the Act, or the rules and regulations of the
Commission issued thereunder, with respect to any part of the Registration
Statement, including this exhibit. This opinion is rendered solely for your
benefit in connection with the above matter and may not be relied upon in any
manner by any other person or entity without our express written consent.
Very truly yours,
/s/ ANDREWS & KURTH L.L.P.
1173/1198/2698
<PAGE> 1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated March 9, 1999 relating to the
consolidated financial statements and financial statement schedule, which
appears in El Paso Energy Corporation's Annual Report on Form 10-K for the year
ended December 31, 1998. We also consent to the reference to us under the
heading "Experts" in such Registration Statement.
/s/ PRICEWATERHOUSECOOPERS LLP
- ------------------------------
PricewaterhouseCoopers LLP
Houston, Texas
May 3, 1999
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333- ) and the related Prospectus of
El Paso Energy Corporation for the registration of 286,481 shares of its common
stock and to the incorporation by reference therein of our report dated January
19, 1999, with respect to the consolidated financial statements of Sonat Inc.
for the year ended December 31, 1998 included in the El Paso Energy Corporation
Current Report on Form 8-K/A dated April 30, 1999 filed with the Securities and
Exchange Commission.
/s/ ERNST & YOUNG LLP
ERNST & YOUNG LLP
Birmingham, Alabama
April 30, 1999
<PAGE> 1
EXHIBIT 23.3
Consent of Independent Auditors
The Board of Directors
Sonat Exploration GOM Inc.
(formerly Zilkha Energy Company):
We consent to the incorporation by reference in the registration statement on
Form S-3 of El Paso Energy Corporation anticipated to be filed on or about
May 3, 1999, of our report dated December 8, 1997, with respect to the
Statements of Operations and Cash Flows of Zilkha Energy Company for the
year ended December 31, 1996, which report appears in the Form 8-K of
Sonat Inc. dated April 23, 1998 and is incorporated by reference in the
Form 10-K of Sonat Inc. for the year ended December 31, 1998.
Our report, dated December 8, 1997, refers to a change in accounting for oil
and gas properties from the full cost method to the successful efforts
method.
We also consent to the reference to our firm under the heading "Experts"
in the prospectus.
/s/ KPMG LLP
---------------------
KPMG LLP
Houston, Texas
April 28, 1999
