As filed with the Securities and Exchange Commission on May 12, 1997
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
---------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
May 12, 1997
<TABLE>
<CAPTION>
Exact name of Registrant as
Commission specified in its charter, address State of I.R.S. Employer
File No. of principal executive offices, telephone Incorporation Identification No.
<S> <C> <C> <C>
1-8349 FLORIDA PROGRESS CORPORATION Florida 59-2147112
One Progress Plaza
St. Petersburg, Florida 33701
Telephone (813) 824-6400
1-3274 FLORIDA POWER CORPORATION Florida 59-0247770
3201 34th Street South
St. Petersburg, Florida 33711
Telephone (813) 866-5151
</TABLE>
The address of neither registrant has changed since the last report.
This combined Form 8-K represents separate filings by Florida Progress
Corporation and Florida Power Corporation. Information contained herein relating
to an individual registrant is filed by that registrant on its own behalf.
Florida Power makes no representations as to the information relating to Florida
Progress' diversified operations.
<PAGE>
Item 5. Other Events
In light of ongoing securities offerings by Florida Progress Corporation
("Florida Progress") and its subsidiaries, including Florida Power Corporation
("Florida Power") and Progress Capital Holdings, Inc., the following information
is being presented pending distribution of the combined Florida Progress and
Florida Power Quarterly Report on Form 10-Q for the quarter ended March 31,
1997:
Nuclear update. Florida Power issued a News Release and Florida Progress
issued an Investor News report each dated May 12, 1997, regarding Florida
Power's Crystal River Nuclear Plant, which are being filed herewith as Exhibits
99.(a) and 99.(b), respectively.
Item 7. Financial Statements and Exhibits
(c) Exhibits:
Exhibit Number (by
reference to Item 601
of Regulation S-K) Description of Exhibit
99.(a) Florida Power Corporation News Release dated
May 12, 1997 regarding Florida Power's Crystal River
Nuclear unit.
99.(b) Florida Progress Corporation Investor News report dated
May 12, 1997 regarding Florida Power's Crystal River
Nuclear unit.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized. The signature of the undersigned on
behalf of each listed company shall be deemed to relate only to matters having
reference to such company.
FLORIDA PROGRESS CORPORATION
FLORIDA POWER CORPORATION
/s/Jeffrey R. Heinicka
By:____________________________
Jeffrey R. Heinicka
Senior Vice President and
Chief Financial Officer
of each Registrant
Date: May 12, 1997
<PAGE>
EXHIBIT INDEX
Exhibit No. Description of Exhibit
99.(a) Florida Power Corporation News Release dated
May 12, 1997 regarding Florida Power's Crystal River
Nuclear unit.
99.(b) Florida Progress Corporation Investor News report dated
May 12, 1997 regarding Florida Power's Crystal River
Nuclear unit.
EXHIBIT 99.(a)
Florida Power Corporation
News Release
Corporate Relations Department, St. Petersburg, Florida
Media contact:
Melodye Hendrix
(813) 866-4282
[CORPORATE LOGO OMITTED]
Crystal River Nuclear Plant Restart Meetings Held
St. Petersburg, FL (May 12, 1997) -- Florida Power Corporation met last
week with officials from the Nuclear Regulatory Commission (NRC) in Atlanta to
discuss progress relating to the restart of the company's nuclear plant, Crystal
River 3 (CR-3). The unit was taken off-line on September 2 of last year to
repair a cracked lube-oil pipe. After repairs were made on the pipe, the company
continued with the shutdown to perform required modifications on the plant's
emergency cooling system. Similar changes also have been necessary at other U.S.
nuclear plants of the same design. CR-3 is expected to return to service by the
end of this year.
Last week's meetings included a May 8 update to the NRC relating to the
plant's "System Readiness Review Program." The program is designed to assess
safety-related systems and provide reasonable assurance that these systems
comply according to the plant's license. Up to this point, this effort has
involved over 8,000 system checks and over 10,000 worker hours. Engineers from
Florida Power explained that to date, none of the discrepancies has impacted the
company's planned restart date. The company will complete its review by the end
of July.
In addition, a Restart Panel meeting held May 9 involved
representatives from Florida Power and the NRC. The company informed the NRC
that design basis modification work was progressing as planned. The expected
year-end restart date is based on completion of upgrades to the emergency
feedwater system and emergency diesel generators. Field work and testing related
to these modifications is expected to be completed by November, allowing time
for NRC license amendments and final regulatory approval.
Operations and maintenance (O & M) costs associated with the
modifications have not significantly changed. However, the additional work
necessary to complete the "System Readiness Review Program" and resolution of
associated issues has resulted in O & M costs projected for 1997 to be
substantially higher than previously reported.
-continued-
<PAGE>
Florida Power/NRC meetings
page 2.
Florida Power estimates that O & M expenditures could range from $80
million to $100 million higher than its original target for 1997 nuclear O & M
costs. Total O & M expenditures for the nuclear plant could range from $170
million to $190 million in 1997. Additional capital costs for 1997 could range
from $30 million to $45 million, increasing the total capital expenditures for
CR-3 to $40 million to $55 million.
The company does not plan to seek recovery of these additional outage
costs through an increase in customer rates.
"Safe Harbor" Statement under the Private Securities Litigation Reform
Act of 1995: This news release contains forward-looking statements including
statements regarding the estimated O & M and capital costs associated with the
nuclear outage, the impact of the outage on earnings, and the restart of the
nuclear unit by the end of 1997. These statements involve risks and
uncertainties that could cause actual results or outcomes to differ materially
from expectations. Key factors that could have a direct impact on actual results
include successful execution of the restart plan, actions of regulatory bodies,
potential new plant modifications not foreseen at this time which extend the
outage beyond 1997 and other factors described in the company's Securities and
Exchange Commission filings.
Florida Power Corporation is the principal subsidiary of St.
Petersburg-based Florida Progress Corporation (NYSE:FPC) and serves 1.3 million
customers in central and northern Florida.
# # #
EXHIBIT 99.(b)
Florida Progress Corporation
Investor News
Analyst Contacts:
Mark A. Myers (813) 866-4245
Greg Beuris (813) 866-4442
[CORPORATE LOGO OMITTED]
Florida Power Corporation's Crystal River Nuclear Plant Update
ST. PETERSBURG, Florida, May 12, 1997 -- Last week Florida Power Corporation, a
subsidiary of Florida Progress Corporation (NYSE:FPC), met with officials from
the Nuclear Regulatory Commission (NRC) to discuss the status of the utility's
restart plan for the Crystal River nuclear plant. The unit has been down to
address certain design basis issues involving the unit's engineered safeguards
system.
Under the restart plan, Florida Power expects to return the unit to service by
the end of 1997. This restart schedule reflects commitments made by Florida
Power regarding issues to be resolved prior to returning the unit to service.
These commitments were confirmed by the NRC in their confirmatory action letter
dated March 4, 1997. The following actions were identified by the NRC in their
letter.
o Resolve the eight design basis issues identified by Florida Power in
its letter to the NRC dated October 28, 1996.
o Conduct extent of condition reviews to assure that safety-related
systems are in compliance with the licensing and design bases of the
facility.
o Resolve any additional safety or licensing issues identified.
o Meet with the NRC to discuss Florida Power's progress with its
Management Corrective Action Plan (MCAP), Phase II.
Florida Power informed the NRC last week that modification work associated with
the eight design basis issues was progressing along as planned. The restart date
of year-end 1997 is based on completion of upgrades to the emergency feedwater
system and emergency diesel generators. Field work and testing related to
modifications is expected to be completed by November. The process of obtaining
the necessary regulatory approvals for the modifications has, where possible,
been initiated and expected to be completed prior to the year-end restart.
Florida Power also reviewed with the NRC its "System Readiness Review Program,"
which the company established to assess "extent of condition". This program is
designed to provide reasonable assurance that safety related systems are in
compliance with the licensing and design basis of the facility. Under this
program, Florida Power will review 105 plant systems. Florida Power discussed
with the NRC its graded approach in determining the type of review to be applied
to each of the 105 systems. Level I reviews include eight of the plant's major
safety systems. Level II reviews will be applied to 18 systems and Level III
reviews will be performed on the remaining 79 systems.
-- more --
<PAGE>
Page 2
Florida Progress Corporation
Investor News -- Florida Power's
Crystal River Nuclear Plant
The discovery phase of the system readiness reviews began in February. NRC
officials were told last week that the company has completed the discovery phase
for Level I systems, seven Level II systems and five Level III systems. Thus far
this effort has involved more than 8,000 system checks requiring over 10,000
hours of work. Completion of the discovery phase for the system readiness
reviews is scheduled for July and is presently progressing as planned.
Florida Power also reviewed with NRC officials various performance measurements
designed to show the progress of implementation of MCAP II. This plan was
developed after assessments of several functional areas of the plant were done
by Florida Power, the NRC and other nuclear industry professionals.
Some of the performance measurements discussed with the NRC showed an increase
in the number of open issues which, in part, reflects the system readiness
review work being performed on the plant's safety systems. Some of the
discrepancies identified through these reviews may become restart issues. These
discrepancies could involve corrective maintenance, engineering design work and
plant modifications.
CRYSTAL RIVER NUCLEAR UNIT OUTAGE COSTS
Florida Power estimates O&M expenditures could range from $80 million to $100
million higher than its original target for 1997 nuclear O&M costs. Total O&M
expenditures for the nuclear plant could range from $170 million to $190 million
in 1997.
The company reported in January 1997 that nuclear O&M costs would be about $15
million higher in 1997 than 1996. This estimate was based primarily on the eight
design basis modifications identified in October 1996. The O&M estimate
associated with those modifications has not changed significantly. However, the
additional work necessary to complete work associated with "extent of condition"
and resolution of associated issues has resulted in O&M costs projected for 1997
to be substantially higher than previously reported. In addition, Florida Power
has decided to perform, during the current outage, certain tests and maintenance
work originally planned for the 1999 refueling outage. These expenditures are
expected to be about $12 million.
Florida Power expects the additional capital expenditures for 1997 to range from
$30 million to $45 million. Essentially all of the increase is attributable to
plant modifications related to the eight design basis issues. These additional
expenditures would result in total 1997 expenditures ranging from $40 million to
$55 million.
-- more --
<PAGE>
Page 3
Florida Progress Corporation
Investor News -- Florida Power's
Crystal River Nuclear Plant
The financial impact of the nuclear outage is expected to be limited to 1997
since the additional expenditures are considered nonrecurring items. These
outage costs will impact 1997 earnings. However, Florida Power's strong
fundamentals remain unchanged and the company is expected to continue to provide
solid earnings growth. Management continues to take a long-term view of dividend
policy and makes its recommendation to the board of directors after considering
the company's business plan, projected earnings growth and outlook for the
electric utility industry.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995: this news release contains forward looking statements, including
statements regarding the estimated O&M and capital costs associated with the
nuclear outage, the impact of the outage on earnings and restart of the nuclear
plant by the end of 1997. These statements involve risks and uncertainties that
could cause actual results or outcomes to differ materially from expectations.
Key factors that could have a direct impact on actual results include successful
execution of the restart plan, actions of regulatory bodies, potential new plant
modifications not foreseen at this time which extend the outage beyond 1997 and
other factors described in the company's Securities and Exchange Commission
filings.
Florida Progress (NYSE:FPC) is a Fortune 500 diversified utility holding company
with assets of $5.5 billion. Its principal subsidiary is Florida Power, the
state's second-largest electric utility with about 1.3 million customers.
Diversified operations include coal mining, marine operations, rail services and
life insurance.
####
<PAGE>
Florida Power Corporation
1997 Crystal River Nuclear Unit Outage Costs
($ in millions)
O&M Capital
Low High Low High
ORIGINAL 1997 TARGET $ 90.0 $ 90.0 $ 10.0 $ 10.0
---------------- ---------------
(8) Design Basis Issues
Emergency Diesel Generator &
Emergency Feedwater System 9.0 9.0 18.0 33.0
Other 4.0 4.0 10.0 10.0
Extent of Condition
System Readiness Review Program 16.0 26.0
Plant Maintenance 17.0 27.0
Other 10.0 10.0
NRC Generic Issues 8.0 8.0 2.0 2.0
1999 Refuel 11 items brought forward 12.0 12.0
NRC License & Fees 4.0 4.0
--------------- ---------------
Additional 1997 Outage Costs 80.0 100.0 30.0 45.0
--------------- ---------------
TOTAL $170.0 $190.0 $ 40.0 $ 55.0
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