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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event Reported) June 10, 1996
THE COLUMBIA GAS SYSTEM, INC.
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 1-1098 13--1594808
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(State of other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
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20 Montchanin Road, Wilmington, Delaware 19807
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(Address of principal executive offices)
Registrant's telephone number, including area code (302) 429-5000
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Item 5. Other Events
Information contained in a News Release dated June 7, 1996, is incorporated
herein by reference.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
The Columbia Gas System, Inc.
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(Registrant)
By /s/ J. W. Grossman
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Vice President &
Controller
Date: June 10, 1996
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Contacts: Media - - Kelly Merritt (304) 357-2283
Analysts - - Tom Hughes (302) 429-5363
FOR IMMEDIATE RELEASE June 7, 1996
COLUMBIA GAS TRANSMISSION FILES AMENDMENT
TO MARKET EXPANSION
CHARLESTON, W.VA. -- Columbia Gas Transmission Corp. today filed an
amendment to its market expansion proposal that will reduce the project's cost
while maintaining the same service to customers.
In a filing with the Federal Energy Regulatory Commission, the interstate
pipeline unit of The Columbia Gas System, Inc., (NYSE: CG) announced an
arrangement under which Texas Eastern Transmission Corp. will increase capacity
on its Pennsylvania pipeline system and lease the new capacity to Columbia
Transmission. The agreement eliminates the need for approximately $80 million
of facilities Columbia Transmission had proposed to build in Pennsylvania.
"This strategic arrangement benefits everyone," said Catherine Abbott, CEO
of Columbia Transmission. "Our customers win because this amendment reduces the
cost of the project, thus minimizing its already low impact on rates. Columbia
Transmission wins because the lower cost makes us more competitive while
maintaining the same level of service to customers. Texas Eastern will benefit
from the increased throughput on its system."
In February, Columbia Transmission filed for FERC approval of a $350
million expansion project to supply additional firm storage and transportation
services to 23 customers. These customers signed 15-year agreements under which
Columbia Transmission will provide 507,000 dekatherms per day of additional firm
storage and transportation services phased in over a three-year period beginning
in November 1997.
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The amendment enables Columbia Transmission to reduce its proposed
construction by 45.5 miles of pipeline and 14,130 horsepower of compression, all
in Pennsylvania. The company still plans to enhance its storage operations,
construct about 42 miles of pipeline and add approximately 46,000 horsepower of
compression and related facilities in Ohio, Pennsylvania, Virginia and West
Virginia.
In place of the Columbia Transmission facilities, Texas Eastern will
construct 26.2 miles of pipeline loop and install 19,400 horsepower of
compression. The facilities will increase capacity on Texas Eastern's pipeline
system through southern Pennsylvania by 141,500 dekatherms per day. That firm
capacity will be leased to Columbia Transmission for the equivalent term of
Columbia Transmission's agreements with its expansion customers. Due to the
nature of Texas Eastern's facility construction, its costs are expected to be
significantly lower than the cost of facilities originally contemplated by
Columbia Transmission.
Columbia Transmission is seeking to roll into existing rates the cost of
the expansion project. As originally proposed, the impact on customers'
existing rates would have been only about 1 percent to 2.5 percent, well below
the 5 percent threshold level recently established by FERC for new projects.
Columbia Transmission said the amendment reduces the rolled-in rate impact even
further.
Columbia Transmission is the principal interstate pipeline subsidiary of
The Columbia Gas System, Inc., operating 19,000 miles of natural gas pipeline,
serving customers in 15 states with a menu of natural gas storage and
transportation services. Information about The Columbia Gas System, Inc., and
its operating units is available on the World Wide Web at
http://www.columbiaenergy.com.
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