UNITED STATES OF AMERICA
before the
SECURITIES AND EXCHANGE COMMISSION
PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935
in the matter of
CENTRAL AND SOUTH WEST SERVICES, INC.
File No. 70-6802
Dallas, Texas 75266-0164
REPORT FOR PERIOD
April 1, 1996 through June 30, 1996
PURSUANT TO RULE 24
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I. CONSTRUCTION AND FUEL PROJECTS
Central and South West Corporation (CSW) is a public utility holding company
with four electric operating subsidiaries: Central Power and Light Company
(CPL); Public Service Company of Oklahoma (PSO); Southwestern Electric Power
Company (SWP) and West Texas Utilities Company (WTU). Central and South West
Services, Inc. (CSWS) performs at cost, accounting, engineering, tax, legal,
financial, marketing, fuel planning, electronic data processing, centralized
economic dispatching of electric power and other services for CSW and its
subsidiaries. CSWS is required to file quarterly reports concerning: (a)
description of activities for each construction project; (b) method of
accounting for each project; (c) information on fuel projects and (d)
information on the project billing allocations.
(A) METHOD OF ACCOUNTING
The cost of materials, labor, outside services and other expenditures directly
attributable to construction of the jointly-owned projects are paid by CSWS and
SWP as agents for the participating companies. Controlled-disbursement bank
accounts for each project and the CSW money pool facilitate funding of
construction checks. Each company must provide financing for its share of the
construction costs.
A summary statement of activity is provided monthly by CSWS and SWP to the
participating companies. A series of work orders and account numbers enables the
participating companies to record their respective ownership shares of
construction work in progress, retentions payable, accrued sales tax, vendor
accounts payable and cash paid.
(B) CONSTRUCTION ACTIVITIES
COLETO CREEK UNIT #2
No new construction or engineering activities occurred on this project during
the quarter. This project has been suspended. CSWS is continuing to provide
contract administration, including contract suspension costs, and maintenance of
environmental permits during the project's dormant period. No costs were
incurred this quarter.
WALKER COUNTY UNIT #1
No new construction or engineering activities occurred on this project during
the quarter. This project has been suspended. No costs were incurred this
quarter.
HIGH VOLTAGE DIRECT CURRENT LINES (HVDC)
SOUTH: In December 1985, all engineering and construction related work on the
south Texas HVDC Interconnection project was suspended.
EAST: In 1987, CSW received an order from the Federal Energy Regulatory
Commission (FERC) approving the East HVDC Tie. During 1992 SWP and CPL entered
into an agreement with Houston Lighting & Power Company and Texas Utilities
Electric Company to construct and operate an East Texas HVDC transmission
interconnection. This interconnection will consist of a back-to-back converter
station and 16 miles of 345 kilovolt transmission line connecting transmission
substations at SWP's Welsh Power Plant and Texas Utilities Electric Company's
Monticello Power Plant near Mount Pleasant, Texas. Application for a Certificate
of Convenience and Necessity for the transmission interconnection was approved
by the Public Utility Commission of Texas on March 24, 1993. A turn key contract
for the provision and installation of the major equipment was entered into with
Siemens Energy and Automation, Inc. on March 24, 1993. This 600,000 kilowatt
project was completed and placed in commercial operation on August 6, 1995.
Costs incurred in the second quarter of 1996 include engineering consulting
fees, home office costs, construction costs, and the HVDC supplier's costs.
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EXPENDITURES BY PROJECT :
COLETO WALKER HVDC
CREEK COUNTY EAST (1)
QUARTER ENDED JUNE 30, 1996 (thousands)
CPL $-- $-- $5
PSO -- -- --
SWP -- -- 5
WTU -- -- --
TOTAL $-- $-- $10
(1) Excludes non-affiliated interests in these projects.
COLETO WALKER HVDC
CREEK COUNTY EAST (1)
SIX MONTHS ENDED JUNE 30, 1996 (thousands)
CPL $-- $-- $508
PSO -- -- --
SWP -- -- 508
WTU -- -- --
TOTAL $-- $-- $1,016
(1) Excludes non-affiliated interests in these projects.
(C) FUEL PROJECTS
SOUTH HALLSVILLE: Work on this project consisted of overseeing the contract
miner's reclamation activities. Land and lignite lease maintenance comprised the
majority of the work on this project.
DOLET HILLS: Land and lignite lease maintenance as well as advance royalty
payments comprised the majority of the work on this project. The property is now
in production and advanced royalty payments are being recouped.
WALKER/GRIMES: Land and lignite lease maintenance as well as advance royalty
payments comprised the majority of the work on this project.
KARNACK/WOODLAWN: Land and lignite lease maintenance as well as advance royalty
payments comprised the majority of the work on this project.
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(D) BASIS FOR PROJECT BILLING ALLOCATIONS
SWP PROJECTS:
SOUTH DOLET
OWNERSHIP PERCENTAGE HALLSVILLE HILLS
SWP 85.936% 46.094%
NON-AFFILIATED ENTITIES 14.064% 53.906%
TOTAL 100.000% 100.000%
The South Hallsville project and the Dolet Hills project are in the production
stage.
JOINT VENTURE PROJECTS:
KARNACK WALKER
ALLOCATION PERCENTAGES WOODLAWN GRIMES
CPL 31.47% 31.47%
PSO 26.48% 26.48%
SWP 31.76% 31.76%
WTU 10.29% 10.29%
TOTAL 100.00% 100.00%
ADMINISTRATIVE AND GENERAL ACTIVITIES:
Administrative and general activities included continuing maintenance of a Land
Management System. Expenditures for these activities, along with legal,
accounting, procurement, employee relations, treasury and information services
were $4,593 for the quarter.
EXPENDITURES BY PROJECT:
(thousands)
QUARTER ENDED SOUTH DOLET WALKER KARNACK
JUNE 30, 1996 HALLSVILLE HILLS GRIMES WOODLAWN
(1) (1)
CPL $-- $-- $92 $1
PSO -- -- $77 --
SWP $562 $32 $92 $1
WTU -- -- $30 --
TOTAL $562 $32 $291 $2
(1) Excludes non-affiliated interests in these projects.
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SIX MONTHS ENDED SOUTH DOLET WALKER KARNACK
JUNE 30, 1996 HALLSVILLE HILLS GRIMES WOODLAWN
(1) (1)
CPL $ -- $-- $114 $3
PSO -- -- $96 $2
SWP 1,117 92 $114 $3
WTU -- -- $37 --
TOTAL $1,117 $92 $361 $8
(1) Excludes non-affiliated interests in these projects.
REVISED
QTR ENDED QTR ENDED QTR ENDED SIX MONTHS ENDED
MARCH 31, 1996 MARCH 31, 1996 JUNE 30, 1996 JUNE 30, 1996
(1)
BUDGET ACTUAL BUDGET ACTUAL BUDGET ACTUAL
SOUTH HALLSVILLE (2) $730 $555 $812 $562 $1,542 $1,117
DOLET HILLS (2) 154 60 71 32 225 92
WALKER GRIMES 59 70 95 291 154 361
KARNACK WOODLAWN 1 6 1 2 2 8
TOTAL $944 $691 $979 $887 $1,923 $1,578
(1) Reflects revised budget numbers.
(2) Excludes non-affiliated interests in these projects.
SINCE
CUMULATIVE EXPENDITURES JANUARY 1, 1984
(thousands)
SOUTH HALLSVILLE (1) $20,249
DOLET HILLS (1) 9,244
WALKER GRIMES 17,762
KARNACK/WOODLAWN 5,439
ABANDONED PROJECTS 1,474
TOTAL $54,168
(1) Excludes non-affiliated interests in these projects.
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II. FUEL PRODUCTION ACTIVITIES
CONTRACT
TOTAL TOTAL MINER'S TOTAL
TONS TONS DELIVERED COST OF
PRODUCED SHIPPED COST/TON FUEL/TON
(3)
QUARTER ENDED
JUNE 30, 1996
SOUTH HALLSVILLE (1) 796,247 756,312 $12.66 $13.24
DOLET HILLS (2) 262,460 269,194 23.91 25.91
SIX MONTHS ENDED
JUNE 30, 1996
SOUTH HALLSVILLE (1) 1,581,663 1,537,706 $12.45 $13.03
DOLET HILLS (2) 479,972 496,268 22.97 24.03
The above amounts exclude non-affiliated interests in these projects.
(1) Lignite reserves are owned and controlled by SWP, Oklahoma Municipal Power
Authority (OMPA) and Northeast Texas Electric Cooperative (NTEC) and mined by
Sabine Mining Company. All tonnage was delivered to the Henry W. Pirkey Power
Plant which is also owned by SWP, OMPA, and NTEC. The total cost of fuel is the
sum of the contract miner's delivered cost, lease maintenance and royalty costs,
overhead costs and amortization costs.
(2) Lignite reserves are owned and controlled by SWP, Central Louisiana Electric
Company, Inc. (CLECO) and OMPA. NTEC acquires its ownership share from SWP once
the lignite is delivered to the plant. The lignite is mined by Dolet Hills
Mining Venture. All tonnage was delivered to the Dolet Hills Power Plant which
is owned by SWP, CLECO, OMPA and NTEC. The total cost of fuel is the sum of the
miner's delivered cost, lease maintenance and royalty costs, overhead costs and
amortization costs.
(3) The cost per ton is estimated each month and then adjusted to actual cost
the following month.
III. OIL AND GAS ACTIVITIES
CPL incurred expenditures primarily for the operation and development of
existing leases in south Texas.
QUARTER ENDED SIX MONTHS ENDED
JUNE 30, 1996 JUNE 30, 1996
(thousands) (thousands)
CPL $21 $58
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SIGNATURE
As requested by order of the Securities and Exchange Commission pursuant to the
Public Utility Holding Company Act of 1935, Central and South West Services,
Inc. has duly caused this report to be signed on the 29th day of August 1996.
By : /S/ R. RUSSELL DAVIS
R. Russell Davis
Controller
Central and South West Services, Inc.
2 West 2nd Street
P.O. Box 21928
Tulsa, Oklahoma 74121-1928
Telephone (918) 594-2000
