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: September, 1997
MAINE PUBLIC SERVICE COMPANY
(Exact name of registrant as specified in its charter)
Maine 1-3429 01-0113635
(State, or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
209 State Street, Presque Isle, Maine 04769
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, Including Area Code 207-768-5811
Current Report, Form 8-K for Date of Report
Maine Public Service Company September 4, 1997
Item 5. Other Material Events - Proposed Disposition of Company's
Generation and Generation-Related Assets Pursuant to State Law
Mandating Electric Utility Industry Restructuring
On May 29, 1997, Governor King signed into law legislation
entitled "An Act To Restructure The State's Electric Industry"
(the Act). Please refer to the Company's Form 10-Q for the
quarter ended June 30, 1997 for a complete description of the
Act. Under the Act, all electric utilities in Maine must
divest themselves of their generation or generation-related
assets, located in the United States, by March 1, 2000.
On August 29, 1997, the Company announced its intent to begin
the sale of all of its 91.7 MW of hydroelectric and fossil
fuel generating assets by March 1, 1998 as well as its rights
under a power purchase agreement for the 18.1 MW output of the
Wheelabrator-Sherman Energy Company, an independent power
producer. The Company's evaluation of the timing of the
proposed sale identified several advantages to proceeding with
the divestiture at this time as opposed to waiting until a
time closer to the statutory deadline. Among these reasons
are the high interest in the area's generating assets
engendered by both the New England Electric System's and
Central Maine Power Company's recently announced intent to
sell their assets, the current tight capacity situation in New
England and the New Brunswick Power Corporation's January 1,
1998 implementation of an open access transmission tariff.
On August 29 and September 2, 1997, the Company mailed to over
300 utilities, businesses, power marketers and generators in
the United States and Canada a letter briefly identifying the
assets to be sold and soliciting expressions of interest.
Interested bidders will be required to sign a confidentiality
agreement and will then be furnished with an Offering
Memorandum that describes in considerable detail the assets
being sold and the transaction process. Interested parties
may also visit and inspect the Company's various facilities
and review the Company's generating asset-related documents
and records at the Company's place of business. According to
the schedule in this Offering Memorandum, by October 27, 1997,
all interested bidders must submit a non-binding Statement of
Qualifications indicating their abilities to operate and
maintain the assets and to consummate the transfer. On
November 10, 1997, the Company will notify short-listed
bidders to begin their due diligence activities. Short-listed
bidders will be selected based on their technical and
financial qualifications. On December 8, 1997, binding
proposals will be due from these bidders. By March 1, 1998,
the Company intends to complete negotiations with these
bidders for the transfer of the assets. Stone and Webster
Management Consultants, Inc. is assisting the Company in this
process.
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Current Report, Form 8-K for Date of Report
Maine Public Service Company September 4, 1997
Because of the Company's obligation as sole supplier in its
service territory until March 1, 2000, the Company's proposed
sale has an option where bidders can offer to sell to the
Company the generation through February 29, 2000. On August
26, 1997, the Company also issued an RFP for power supply
through the same period.
The assets to be sold include:
- Millinocket Lake Storage Dam in T-7, R-9, WELS, Maine
- 1.4 MW of hydroelectric power at Squa Pan Generating
Station and Storage Dam in Masardis, Maine
- 30.9 MW Caribou Generating Station, consisting of 23 MW
of oil-fired steam power, 7 MW of diesel power, and .9 MW
of hydroelectric power, all in Caribou, Maine
- 4.2 MW of diesel power at Flo's Inn Generating Station in
Presque Isle, Maine
- a dismantled diesel unit at Houlton Generating Station in
Houlton, Maine
- a 3.3455% interest, equal to 20.7 MW, in the Wyman Unit
No. 4 oil-fired conventional thermal plant in Yarmouth,
Maine
- rights to 18.1 MW under the Power Purchase Agreement with
the Wheelabrator-Sherman Energy Company, a wood-burning
cogenerator, located in Sherman Mills, Maine
The Company has also offered for sale the property of its
wholly-owned Canadian subsidiary, The Maine and New Brunswick
Electrical Power Company, Limited. The subsidiary's principal
asset is the 34.5 MW Tinker Station, consisting of 33.5 MW of
hydroelectric power and 1 MW of diesel power, located in
Aroostook Junction, New Brunswick. The Company is offering to
sell the subsidiary or its assets under one of three options:
(a) Purchase of the entire stock ownership of the Subsidiary,
which will transfer title to all the Subsidiary's assets;
(b) Purchase of only the Subsidiary's generating assets; and
(c) Purchase of only the right to the output of the
Subsidiary's generating assets, with title to the assets
remaining with the Subsidiary.
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Current Report, Form 8-K for Date of Report
Maine Public Service Company September 4, 1997
This plan must be approved by the Maine Public Utilities
Commission (MPUC) after hearing. The Company intends to file
its petition for approval with the MPUC early in September.
It cannot predict the timing or the nature of the MPUC's final
decision in this matter. Moreover, sale of any generating
assets located in the Province of New Brunswick, Canada, to
any entity other than the New Brunswick Power Corporation
requires the approval of the Provincial government.
MAINE PUBLIC SERVICE COMPANY
Registrant
Dated: September 4, 1997 /s/ Larry E. LaPlante
Larry E. LaPlante, Vice President
Finance, Administration and Treasurer
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