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File Number 70-8981
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Amendment No. 3
to
Form U-1
APPLICATION-DECLARATION UNDER THE PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935
By
CONSOLIDATED NATURAL GAS COMPANY
CNG Tower
625 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3199
(a registered holding company and the direct
or indirect parent of the other parties)
CNG ENERGY SERVICES CORPORATION
CNG POWER COMPANY
One Park Ridge Center
P.O. Box 15746
Pittsburgh, Pennsylvania 15244-0746
Names and addresses of agents for service:
S. E. WILLIAMS, Senior Vice President
and General Counsel
Consolidated Natural Gas Company
CNG Tower
625 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3199
N. F. CHANDLER, General Attorney
Consolidated Natural Gas Service Company, Inc.
CNG Tower
625 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3199
<PAGE> 2 File Number 70-8981
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 3
to
FORM U-1
APPLICATION-DECLARATION UNDER THE PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935
Consolidated Natural Gas Company et al. hereby amend the application-
declaration under the above file number as follows.
Item 1. Description of Proposed Transaction
___________________________________
The first sentence under "GUARANTEES AND OTHER CREDIT SUPPORT" on page 4
of Amendment No. 2 to the application-declaration is changed to read as
follows:
"Application is made for Consolidated, Energy Services, CNG Power and
Intermediate Companies to enter guarantee arrangements, obtain letters of
credit, and otherwise provide credit support with respect to EWG related
obligations of their respective subsidiaries (including EWGs themselves)
to third parties as may be needed and appropriate."
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Item 6. Exhibits and Financial Statements
_________________________________
The following exhibit is made a part of this statement:
(a) Exhibits
F Opinion of counsel for Consolidated, Energy Services
and CNG Power.
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned companies have duly caused this amendment to be signed
on their respective behalf by the undersigned thereunto duly authorized.
CONSOLIDATED NATURAL GAS COMPANY
By D. M. Westfall
Senior Vice President
and Chief Financial Officer
CNG ENERGY SERVICES CORPORATION
CNG POWER COMPANY
By N. F. Chandler
Their attorney
Date: January 7, 1998
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EXHIBIT F
January 7, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Consolidated Natural Gas Company, et al.
SEC File Number 70-8981
Dear Madams and Sirs:
The following opinion is rendered in accordance with the requirements of
Exhibit F to Form U-1 under the Public Utility Holding Company Act of 1935 (the
"Act") with respect to certain transactions proposed by Consolidated Natural
Gas Company ("Consolidated"), CNG Energy Services Corporation ("Energy
Services") and CNG Power Company ("CNG Power") in the Application-Declaration
at SEC File No. 70-8981, as amended ("Application"). The transactions proposed
in the Application are described below and are hereinafter referred to as the
"Proposed Transactions."
Energy Services is a wholly-owned nonutility subsidiary of Consolidated.
CNG Power is a wholly-owned subsidiary of Energy Services and is engaged
principally in the power generation business. Consolidated, Energy Services
and Power Company are collectively referred to herein as the "Companies."
Consolidated proposes that Power Company become the primary vehicle for
the CNG System to invest in exempt wholesale generators ("EWGs"), as defined in
Section 32(a) of the Act, within the United States. Investments in EWGs by
Power Company will be made using internally generated funds of Consolidated and
will accordingly be outside the authorizations sought in the Application and
subject to the limitations of Rule 53 promulgated under the Act.
Special purpose subsidiaries ("Intermediate Companies") to be exclusively
engaged in activities to facilitate the consummation of investments in EWGs may
be formed by CNG Power. Intermediate Companies may acquire interests in other
corporations, joint ventures, partnerships, limited liability companies and
other investment entities created for the purpose of investing in EWGs.
The Application seeks authority for Consolidated, Energy Services, CNG
Power and Intermediate Companies to enter guarantee arrangements, obtain
letters of credit, and otherwise provide credit support with respect to EWG
related obligations of their respective subsidiaries (including EWGs
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themselves) to third parties as may be needed and appropriate. The maximum
aggregate limit on all such credit support by Consolidated, Energy Services,
CNG Power and its subsidiaries at any one time would be $150 million. Credit
support authorization would be for the period ending December 31, 2002.
Energy Services and its affiliates may perform services or construction
for, or sell goods to, an EWG in which CNG Power has acquired an interest.
These activities would be at market rates if the EWG does not provide services,
construction or goods directly or indirectly to Consolidated System utility
affiliates located in the United States. Energy Services and its affiliates
may contract with Consolidated associate companies in order to provide the
above services, construction and goods. Such activities involving nonutility
associates may be at either cost or market; provided, however, that services,
construction and goods from nonutility associates substantially involved in the
provision of services, construction or goods to Consolidated domestic utility
associates would be at cost.
Energy Services has authorized capital of 4,000 shares of common stock,
$1.00 par value per share ("Common Stock"). The Application seeks authority to
(i) change the par value of each share of Common Stock from $1.00 to $10,000
and (ii) increase Energy Services' Common Stock equity authorization to 50,000
shares of common stock, $10,000 par value per share. Each outstanding share of
$1.00 par value would be converted into a share of $10,000 par value through
the transfer of $9,999 per share from the capital in excess of par value
account to the capital stock account.
I have examined the certificates of incorporation and bylaws of the
Companies; corporate actions of the Companies relating to the Proposed
Transactions to date; the Application and all amendments thereto to date; and
such other documents, records, laws and other matters as I deemed relevant and
necessary for the purposes of this opinion.
Based on such examination and relying thereon, I am of the opinion that
when the Commission permits the Application to become effective, all requisite
action will have been taken by the Companies with respect to such Proposed
Transactions, except the actual carrying out thereof.
In the event the Proposed Transactions are consummated in accordance with
the Application as amended, I am of the opinion that:
(a) No state commission has jurisdiction of the Proposed Transactions;
(b) All state laws applicable to the Proposed Transactions will have been
complied with;
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(c) The Companies are validly organized and duly existing;
(d) The direct or indirect guarantees and other credit support arrangements
of each of the Companies will be the valid and binding obligations of
each such respective corporation; and
(e) The consummation of the Proposed Transactions will not violate the
legal rights of the holders of any securities issued by Consolidated or
any associate company thereof.
I hereby consent to the use of this opinion in connection with the filing
being made contemporaneously herewith in the proceeding under the above
referenced file number.
Very truly yours,
N. F. Chandler
Attorney
